Lending activity at the top 21 banks receiving bailout money declined in April, making the month the fifth out of the last six to be marked by a lending downturn.
The Treasury Department's monthly report on lending activity found that overall loan balances declined by 1 percent among the leading banks that got aid under the Troubled Asset Relief Program.
In even more worrying signs, loan originations declined 7 percent across the board, while 9 percent of mortgages are now at least 30 days delinquent.
The results were mixed among lending classes. Home equity lines saw a 9 percent decrease in originations, the Treasury reported. Student and auto loans saw an increase in originations, as did renewals of existing commercial and industrial accounts. New commercial and industrial commitments, however, declined 29 percent.
Consumer credit card balanced remained flat, suggesting that "many customers focus on paying down debt," Treasury said.
Lending activity among the 21 banks also varied. Six experienced increases in total originations from March to April, while 15 experienced decreases. Only two banks reported increases in total outstanding balances, while 19 had decreases.
Of the 21 banks, Bank of America Corp. booked the largest dollar value of originations, with $68.1 billion in new lending. Wells Fargo & Co. was second with $65.1 billion.
Overall, the Treasury report pointed to an economy moving slowly toward recovery. In addition to banking factors, the department pointed to stabilizing joblessness numbers and the retreat of short-term credit spreads as reasons to be optimistic.
The Treasury Department's monthly report on lending activity found that overall loan balances declined by 1 percent among the leading banks that got aid under the Troubled Asset Relief Program.
In even more worrying signs, loan originations declined 7 percent across the board, while 9 percent of mortgages are now at least 30 days delinquent.
The results were mixed among lending classes. Home equity lines saw a 9 percent decrease in originations, the Treasury reported. Student and auto loans saw an increase in originations, as did renewals of existing commercial and industrial accounts. New commercial and industrial commitments, however, declined 29 percent.
Consumer credit card balanced remained flat, suggesting that "many customers focus on paying down debt," Treasury said.
Lending activity among the 21 banks also varied. Six experienced increases in total originations from March to April, while 15 experienced decreases. Only two banks reported increases in total outstanding balances, while 19 had decreases.
Of the 21 banks, Bank of America Corp. booked the largest dollar value of originations, with $68.1 billion in new lending. Wells Fargo & Co. was second with $65.1 billion.
Overall, the Treasury report pointed to an economy moving slowly toward recovery. In addition to banking factors, the department pointed to stabilizing joblessness numbers and the retreat of short-term credit spreads as reasons to be optimistic.
published June 16, 2009, 0 Comments
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