Magazine article Economic Trends

Business Loan Markets

Magazine article Economic Trends

Business Loan Markets

Article excerpt

08.06.07

The April 2007 Senior Loan Officer survey (covering the months of February, March, and April) revealed a slight increase in credit availability for businesses. After a slight tightening of standards reported on the previous survey, domestic and foreign banks reported that their lending standards were little changed for commercial and industrial loans for borrowers of all sizes in the last three months. More domestic banks narrowed their lending spreads (loan rates over the cost of funds), attributing their decision to more aggressive competition from other banks and nonbank lenders, and increased liquidity of business loans in the secondary market. Many foreign banks, as well as some domestic banks, also reduced the cost of credit lines and eased loan covenants.

[GRAPHIC OMITTED]

Demand for commercial and industrial loans continued to weaken over the past three months, and at a faster rate, than reported in the January survey. Those institutions that reported weaker demand for commercial and industrial loans cited as motivation a decreased financing need for accounts receivable and competition from other credit sources. …

Search by... Author
Show... All Results Primary Sources Peer-reviewed

Oops!

An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.