Lending standards for business loans are getting tighter, according to the Federal Reserve’s “Senior Loan Officer Opinion Survey” (SLOOS).
Guest article by Bob Bryan | Business Insider
“Banks have been tightening standards for both commercial and industrial (C&I) and commercial real estate (CRE) loans over the past few quarters and the latest data from the Senior Loan Officer Opinion Survey shows the most severe tightening in lending standards for these types of loans so far in the expansion,” said Daniel Silver, economist at JPMorgan.
C&I loans are a catch-all category for loans that help finance purchases or upgrades of equipment.
Essentially, the Fed surveys people in charge of giving out loans at financial institutions and asks them if it’s getting harder or easier to get a loan. For the past two quarters, these officers have been reporting standards tightening at a faster rate.