The paper aims to test the impact of macroeconomic and microeconomic indicators on the quality of bank lending, based on a sample of 711 European banks with different specialisations, in the period 2013-2017. The evidences show that, on one side, adverse macro conditions worsen the quality of loans. On the other side, banks with higher profitability and capitalisation have a lower level of non-performing loans and loss reserves. Finally, the analysis indicates that more branches are negatively associated with credit quality, however their negative impact is reduced for larger banks.
