Biggest U.S. Banks Curb Loans as Regional Firms Fill Gap
Bloomberg reported that the biggest U.S. banks are extending less credit amid a faltering economic recovery as regional lenders step in to fill the gap.
Bloomberg said total loans at the four largest U.S. banks – JPMorgan Chase, Bank of America, Citigroup and Wells Fargo – fell 4.9% to $3.04 trillion in the first quarter from the same period in 2010, according to data compiled by Bloomberg. Lending by the 17 smallest of the 24 firms in the KBW Bank Index (BKX) increased 9.8% to $1.27 trillion.
Bloomberg quoted David Jones, a former economist at the Fed in New York, as saying in an interview, “It’s the health of the banking system and the banks’ ability and willingness to extend credit that’s at the heart of any recovery. If anything helps in getting this recovery going, it’ll be those regional banks.”
To read the full Bloomberg story, click here.