Fed survey: business lending standards largely unchanged amid rising demand

Lending standards for business loans remained largely unchanged in the first quarter of 2022, according to the Federal Reserve’s senior loan officer opinion survey released today. Lenders reported a general easing of standards for consumer loans during the survey period.

  • C&I. Commercial and industrial lending standards to firms of all sizes remained basically unchanged in the first quarter, following four quarters of easing. Terms on C&I loans generally eased for large and middle-market firms, though net percentages reported tightening on premiums charged on riskier loans and collateralization requirements, while for small firms, net percentages reported tightening on costs of credit lines, premiums charged on riskier loans and collateralization requirements. Demand for C&I loans was generally up for small, middle-market and large firms.
  • CRE. A modest net share of banks reportedly eased standards for commercial real estate loans secured by multifamily properties, while standards were basically unchanged, on net, for construction and land development loans and nonfarm nonresidential loans. Demand was stronger on net for loans secured by multifamily residential properties.
  • Mortgages. On net, standards eased for all types of mortgages and home equity lines of credit, though demand was down across the board for all mortgage types. HELOCS, on the other hand, saw demand increase, with a net 5.3% reporting that demand was moderately or substantially stronger.
  • Personal lending. Banks reported a greater willingness to make consumer installment loans than they did three months prior—a net 18.6% said they would be somewhat more willing to do so. On net, standards eased on credit cards, auto loans and other personal loan types. Banks also reported increased demand on net across all personal loan types.