The final paper analyses the relationship between the optimism and confidence index and credit activity in the Republic of Croatia over the last decade. The first part of the final paper is of a theoretical nature, describing the credit activity of banks as monetary institutions through active banking operations, and the management of credit risk aimed at reducing potential losses by identifying risk situations and applying appropriate measures for their management. The multiplication of deposits and loans also has a significant impact on the economy. Furthermore, in order to facilitate correlation analysis, the significance of measuring consumer confidence indicators and business optimism has been clarified. Measuring these indicators has an important impact on business performance, the stability of the economy and social progress. Monitoring and understanding business cycles is also essential for anticipating economic trends and making political decisions. In the second part of the paper, an analysis of confidence indices and credit activity is carried out, where first the variables used and then the methodology itself are described. The Pearson`s correlation coefficient has become a standard tool for measuring the linear relationship between two continuous variables. While the indices of optimism and confidence reflect the perception of economic stability and economic growth forecasts, credit activity shows banks` level of confidence in borrowers and general lending readiness. The results show that the strongest link between credit and consumer confidence index is the weakest link between credit and business optimism in services. It is important to note that while confidence indices may be indicators of credit activity, they are not the only determinants. Other economic indicators, such as inflation rates, interest rates and unemployment levels, also play a key role in shaping banks' credit policy.