Fed Survey: Enterprise Main Requirements Tighten, Demand Grows Stronger

Lending requirements for enterprise loans tightened through the second quarter of 2022, in accordance with the Federal Reserve’s senior mortgage officer opinion survey launched as we speak. Lenders additionally reported no change in requirements for client loans through the survey interval.

• C&I. Banks reported having tightened requirements on industrial and industrial loans to corporations of all sizes after a number of quarters of continued easing final yr and unchanged requirements within the earlier quarter. Tightening was most generally reported for premiums charged on riskier loans. On the identical time, a majority of banks reported stronger demand for loans from giant and middle-market corporations and whereas a smaller share reported stronger demand from small corporations.
• CRE. A major web share of banks (20%-49%) tightened requirements for all industrial actual property mortgage classes. Reasonable web shares of banks (10-20%) reported weaker demand for building and land improvement loans and for nonfarm nonresidential loans. A modest web share of banks (5%-10%) reported stronger demand for loans secured by multifamily properties.
• Mortgages. On web, banks reported no change in lending requirements for many mortgages. Nonetheless, a average web share of banks tightened requirements for subprime residential mortgages, whereas modest web shares of banks tightened requirements for QM jumbo and non-QM non-jumbo residential mortgages, in addition to for HELOCs. Most banks reported weaker demand for all RRE loans over the second quarter, aside from HELOCs, which skilled stronger demand.
• Private lending. Lending requirements for all client mortgage classes—bank card loans, auto loans and different client loans—remained principally unchanged. Banks additionally reported most phrases on bank card loans remained unchanged. The exception was a modest web share of banks that reported having elevated (i.e. eased) credit score limits. Banks additionally reported, on web, leaving most phrases on auto loans and different client loans unchanged.