Daily News: June 18, 2012

Survey: Mixed Expectations for Short-, Long-Term Lending


Results of the second quarter Phoenix Management “Lending Climate in America” survey finds that lenders’ short-term expectations for lending and the economy are down from previous quarters. Lenders demonstrated a bit more optimism about the economy longer term.

Domestic lending segments (corporate, middle-market and small business) decreased by five percentage points on the diffusion index compared to last quarter’s survey. Also, senior debt to EBITDA ratios show slight tightening of lending standards reversing the trend from most prior quarter’s easing. However, longer-term outlook shows slightly improved economic sentiment.

Ninety-five percent of lenders believe the economy will perform at a “C” level or better in the six to twelve month period, compared to 83% in the previous quarter. Ninety-five percent of lenders believe the economy will perform at a “C” level or better in the six to twelve month period, compared to eighty three percent in the previous quarter.

“In terms of the economy, lenders’ outlook regarding macroeconomic indicators remained largely unchanged from quarter to quarter,” said Michael Jacoby, Phoenix senior managing director and shareholder. “However, lenders did expect unemployment to improve.”

To see the full results of Phoenix’s “Lending Climate in America” Survey, click here.