Rising interest rates and a slowing economy to him meant that loan growth would likely fall by half as the Danville, Virginia-based community bank turned its focus to better-quality, higher-yielding credit, worrying little about volume.
After a year of racing along a virtually unfettered path to higher interest rates, the Federal Reserve is facing its first significant pothole as the decisions made in hundreds of bank executive suites will either add up - or not - to an economy-shaping drop in lending. But the potential for a worse-than-expected credit crunch remains elevated in the wake of the Silicon Valley Bank and Signature Bank collapses last month, which raised concerns of a larger financial panic.
The response - less lending, tighter credit standards and higher interest on loans - was already taking shape. Officials are now watching for signs that has been kicked into overdrive. "Survey data is going to be very important because it's going to give us a sense of whether financial institutions are pulling back even more on their credit standards," Cleveland Fed President Loretta Mester said last week. "We already saw it happening, which you'd expect to see as interest rates moved up ... That was kind of a normal thing."
A Dallas Fed bank conditions survey, conducted in late March after the two bank failures, indicated lending standards in that Fed regional bank's district have kept tightening, with loan demand falling.
This is the media honking that the manufactured 'crisis' will soon be playing out - and the govt 'has a plan.'
All your boating was on credit dearie 🙈
BIDENFLATION BIDENFLATION BIDENFLATION
Ничего, Бидон ляжет на рельсы и кризиса не будет.