Banks tighten lending standards, see lower demand for commercial loans (Fed survey)
(Reuters) – U.S. banks tightened lending standards and lending terms on commercial loans in the third quarter, as demand for commercial loans fell to its lowest level in more than a decade as the pandemic coronavirus disease has made companies more cautious, according to a Federal Reserve investigation released on Monday.
Banks have also tightened standards on most forms of consumer credit, but demand has improved there for loans for major purchases such as homes and automobiles, the Fed said in its quarterly survey. opinion from the main loan officers.
Most banks reported that the overall level of forbearance did not exceed 5%, although in some categories such as residential mortgages and some commercial real estate loans, a significant net share of banks said the levels of forborne abstentions were above 10%, according to the survey. Banks offered loan forbearance earlier this year when the COVID-19 pandemic forced business closings and tens of millions of layoffs.
Reporting by Dan Burns; Editing by Chizu Nomiyama