Monday, August 4, 2014

Bank Lending Standards Easing

Over the past three months, banks loosened lending standards while loan demand rose slightly over the prior three months, according to the July Federal Reserve’s Senior Loan Officer Survey.

Overall, 10.7% of the responding banks reported easing standards for commercial and industrial (C&I) lending to large and medium sized borrowers, and a net 8.3% loosened standards for small business loans. Stronger loan demand for medium-to-large borrowers was reported for a net 30.7% of the banks, but a net 25.0% reported weaker demand from small borrowers.

The survey found that C&I and CRE lending generally increased to firms of all sizes, while CRE loan standards remained unchanged since the April report.

Credit card, auto and nontraditional closed-end mortgage loans to households saw unchanged loan standards since the last report. There was stronger demand for prime residential mortgages for the first time in a year.

Read the release.

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