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LJUBLJANA, Jan 10 (Reuters) - Slovenian bank loans to corporations and non-financial institutions fell by 11 percent year on year in November, the government's macroeconomic institute said on Tuesday.
It added banks increased the amount of loans to households by 2.5 percent in the same period while loans to the state were up by 0.2 percent.
Slovenian bank lending has been falling for years after the country in 2013 narrowly avoided an international bailout for its lenders. That year the previous government had to pour more than 3 billion euros into local banks to prevent them from collapsing because of bad loans.
"The cost of borrowing at Slovenian banks is less favourable than in (the rest of) the euro zone. As a consequence clients are seeking alternative financial resources. Corporations are increasing short-term debt abroad," the institute said in its monthly report.
Lending continues to fall although banks reduced the percentage of bad loans to 6.4 percent of all loans in September. The country returned to growth in 2014 and expects its economy to expand by 2.9 percent this year.
Some of the biggest Slovenian banks are still state-owned so the government controls about 45 percent of the banking sector.
A number of foreign banks are also present in the country, including France's Societe Generale, Italy's Unicredit and Intesa Sanpaolo, Russia's Sberbank and Austria's Sparkasse and Addiko Bank. (Reporting by Marja Novak; Editing by Alexandra Hudson)