FRANKFURT, Oct. 25 (Xinhua) -- Bank lending to households and corporates slowed down in September as key interest rates have been raised to restrictive levels by the European Central Bank (ECB), the institution said on Wednesday.

The growth rate of adjusted loans to households decreased to 0.8 percent from 1 percent in August, while that of adjusted loans to non-financial corporations slipped to 0.2 percent from 0.7 percent, the ECB said in a press release.

The slowdown in bank lending coincided with weaker demand for credits in the eurozone at a time when borrowing costs have been pushed high.

According to the results of the ECB's bank lending survey published on Tuesday, the net decrease in demand from firms and households for credits was more than banks had expected and was described as "substantial."

The "stagnation" of bank lending in September is a sign that higher interest rates are exerting a significant impact on the economy, Bert Colijn, an economist with ING bank, commented in a note.

The ECB is set to hold a Governing Council meeting on Thursday to discuss interest rates. The recent indicators, according to Colijn, have shown that "a recession is a clear risk at this point." Enditem

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