May/June 2012

2012 ABL Marketplace Survey: Lenders Voice Concern Over Regulatory Oversight, Irrational Behavior

In ABF Journal’s 2012 Marketplace Survey, participating lenders showed little restraint in voicing their dissatisfaction on what they perceive to be a troubling trend – the return to “irrational pricing” and “undisciplined behavior.” And competition isn’t the only concern with this year’s respondents.



In ABF Journal’s 2011 Marketplace Survey lenders noted that the heat was on and competition amped-up to a frenzied pace. Back then, one respondent commented, “It’s complete and total insanity already.” A year later, with a presidential election on the horizon and a steady stream of unsettling news from around the world — issuing from the euro-zone in particular — competition still tops the list as a major concern. This year, however, those respondents who cared to comment on the survey showed little restraint in voicing their dissatisfaction on what they perceive to be a troubling trend. Comments ranged from “a return to irrational pricing” and “undisciplined behavior” to “seems like it’s 2007 all over!” and a reference to the actions of “stupid competitors.”

And competition isn’t the only concern with this year’s respondents. Once again, fiscal and regulatory policies top the list of greatest concerns in the broadest sense. This naturally correlates to the responses received with regard to economic stimulus and the efficacy of the actions taken by the current administration, the Department of the Treasury and the Federal Reserve. Nearly 80% of the respondents don’t see these actions as effective. As for a full-blown economic recovery, slightly more than half of the participants pushed out their expectations to 2014 and beyond (50.7%), with 29.6% predicting the second half of 2013 and 19.7% seeing sustained solid economic growth by the first half of next year.

This year, we had the opportunity to ask the “once in every four years” question: How is the upcoming presidential election impacting commercial loan demand? The answer to that question lies in the pages that follow. Having conducted five of these surveys, our sense this year is that while the worst is behind us, the respondents are a bit weary of the waiting game for conditions to stabilize.

2012 About the Survey

This year, 142 professionals from a select pool of more than 1,100 asset-based lenders took the time to participate in ABF Journal’s 2012 Mid-Year Marketplace Survey. We thank these professionals for the benefit of their observations and experience.