All Articles Tagged "business lending"
Banks Back to Business Lending
(Wall Street Journal) — Here’s news that should offer little comfort to people struggling to find work: Bank loans to businesses are expanding, but those businesses aren’t using the money to fund expansion. So far this year, banks made $61 billion more commercial and industrial loans–an increase of %6.2%–than in the year-earlier January to August period, Federal Reserve data show. Commercial and industrial loans are business loans excluding real estate. Between January and August last year, such loans fell more than 11% from the year-earlier period.
Racism Obstacle for Minority Business Owners
(Wall Street Journal) — Minority-owned businesses have long faced barriers when it comes to access to credit. And even today, racial discrimination may still be to blame. That’s the viewpoint of Robert W. Fairlie, professor of economics at the University of California Santa Cruz, who testified recently at a Senate hearing on the topic. Discrimination, he concluded, is the reason why minority-owned firms applying for loans get rejected twice as much as their non-minority counterparts. Fairlie, who analyzed Federal Reserve data from 2003, also found that minority firms that do obtain loans pay one-and-a-half percentage points higher interest rates than white-owned firms.
Loan Spigot Opens
(Wall Street Journal) — Some big U.S. banks are starting to increase their lending to businesses as demand for loans rises and healthier banks seek to grab customers from weaker rivals. After declining steadily for most of the past two years, the amount of commercial and industrial loans held by commercial banks inched upward during the past two months, according to the Federal Reserve. Moody’s Analytics estimates that commercial and industrial lending in the fourth quarter has grown 0.2% from the third quarter, to $1.22 trillion, the first quarterly increase in two years. Moody’s predicts such lending will rise 3% next year.
