Banks easing lending standards, Fed survey shows
The Fed also found that loan demand is picking up broadly since earlier in the year.
The nation’s banks are making it generally easier for consumers and industries to get residential mortgages and business and commercial real-estate loans, the Federal Reserve said Monday.
In a July survey of senior loan officers, the Fed also found that loan demand is picking up broadly since earlier in the year. Banks reported having experienced the strongest demand in a year for prime residential mortgages.
“The July survey results showed a continued easing of lending standards and terms for many types of loan categories amid a broad-based pickup in loan demand,” the Fed said.
The Fed’s findings suggest that banks’ profit margins could come under pressure; that’s because most U.S. respondents — nearly 70 percent — said a key reason for easing standards or terms on business loans over the past three months was due to more aggressive competition from other banks and other types of lenders.