Banks Tighter With Business Credit Despite Fed Rate Cuts
WASHINGTON — Many U.S. banks were still tightening business credit in recent months even as the Federal Reserve was cutting interest rates to jump-start the flagging economy, according to a Fed survey of bank lending officers that was released Thursday.
“The number of foreign and domestic banking institutions that reported tightening standards and terms on commercial and industrial loans over the past three months remained in the elevated range of the last three regular surveys,” the central bank said.
The Fed has been concerned about businesses’ access to money, fearing that companies will be unable to borrow to make capital investments. The Fed repeatedly has cited weakened business investment as a major risk economic expansion.
The latest survey polled officials at 55 large U.S. banks and 21 U.S. branches of foreign banks.
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