Fed survey reveals tightening lending standards, weak demand
The Federal Reserve's second-quarter senior loan officer opinion survey (SLOOS) revealed banks tightened standards and saw weaker demand for loans to consumers as the coronavirus pandemic continued.
“Banks tightened lending standards broadly in the second quarter," said NAFCU Chief Economist and Vice President of Research Curt Long. "The Federal Reserve is estimating that consumer loans outstanding at commercial banks shrunk by an annualized 17 percent in the second quarter.
"Given how much banks are curtailing credit provision, the NCUA should provide credit unions with more capital relief, which will allow them to step into the gap created by bank retrenchment," Long added.
During the second quarter, major net shares of banks reported tightened standards and a drop in demand for commercial and industrial loans from firms of all sizes, and across all three major commercial real estate loan categories.
Additionally, banks saw drops in residential real estate loans and all three consumer loan categories – credit card loans, auto loans, and other consumer loans.
In relation to demand for residential real estate loans, a major net share of banks reported having experienced stronger demand for government-sponsored enterprise (GSE)-eligible residential mortgages.
This senior loan officer survey was based on responses from 75 domestic banks and 22 U.S. branches and agencies of foreign banks.
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CUNA Mutual Group
Add to Calendar 2020-09-21 14:00:00 2020-09-21 14:00:00 Member Business Lending in Relation to COVID Impacting Loans Millions of lives and businesses have been changed by the COVID-19 pandemic. The lasting impacts of COVID-19 – both physically and economically – are still unknown, and the world continues to find ways to adjust in order to meet the difficulties caused by the disease head on. Credit unions have had to respond swiftly and thoughtfully to match the evolving needs of their communities and members, and other affected industries. Eviction moratoriums, payment deferrals, loan modifications and the birth of the Paycheck Protection Program and the terms of loan forgiveness, including the efficacy of these policies to date, are a few of the topics examined in this webinar. Key Takeaways Understand how COVID-19 has dramatically changed the world of commercial lending Examine how financial institutions have responded to the problems created or exacerbated by COVID-19 Review the key aspects of the Paycheck Protection Program under the CARES Act, and other available relief Register NowRegistration is complimentary, but you must register to attend.One registration gives your entire credit union access to the on-demand recording until September 21, 2021.Already registered? Go to the Online Training Center to view live. Who Should Attend? NAFCU Certified Compliance Officers (NCCOs) NAFCU Certified Risk Managers (NCRMs) Chief Executive Officers (CEOs) Chief Lending Officers (CLOs) Lending, risk, marketing and business development staff Education Credits NCCOs will receive 1.5 CEUs for participating in this webinar NCRMs will receive 1.5 CEUs for participating in this webinar. CPA credit information is below; recommended 1.5 CPE credits. CPA Certification Credit Information Reviewer: Josie Collins, Associate Director of Education, NAFCU Learning Objectives: Understand how COVID-19 has dramatically changed the world of commercial lending. Examine how financial institutions have responded to the problems created or exacerbated by COVID-19. Review the key aspects of the Paycheck Protection Program under the CARES Act, and other available relief. Program Level: Basic Prerequisites Needed: None Advance Preparation Needed: None Delivery Method: Group Internet-Based Recommended CPE Credits: 1.5 credits Recommended Field of Study: Finance - Technical National Association of Federal Credit Unions (NAFCU) is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. Learn more. About Our Webinars Our webinars are streamed live from NAFCU headquarters near Washington, D.C. Your audio/video feed of the presenters includes presentation slides and downloadable handouts. You can easily submit your questions to the presenters at any time during the live broadcast, with no dialing over the phone! The audio and video stream directly through your computer. Web NAFCU firstname.lastname@example.org America/New_York public
Credits: NCCO, NCRM, CPE
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