The Federal Reserve's quarterly Senior Loan Officer Opinion Survey on Bank Lending Practices released this week shows that lending remained tight for consumer loans over the past three months.
The April survey of 56 domestic banks and 23 U.S. branches and agencies of foreign banks shows that the majority of banks are in no hurry to ease their lending requirements and are maintaining their stringent standards for lending. Some banks made further decreases in credit lines and tightened credit standards on new credit card applications.
"This helps explain why revolving credit, which is primarily credit card usage, fell for the 17th consecutive month in February. Revolving credit has fallen by almost $100 billion since the fourth quarter of 2008," says Bill Hardekopf, CEO of www.LowCards.com and author of The Credit Card Guidebook. "Issuers acted quickly to protect themselves from additional risk and loss during the economic downturn. Tightened credit standards, higher credit scores and lower limits are currently the parameters for lending by credit card issuers."
According to the survey:
* 15.2 percent said credit standards for credit card applications tightened somewhat. 78.8 percent said standards remained unchanged.
* 26.5 percent have tightened credit limits (35 percent of large banks). 64.7 percent said limits remained basically unchanged.
* 11.8 percent increased the minimum required credit score. 85.3 percent said credit score requirements remained basically unchanged.
*22.9 percent decreased the size of credit lines for existing cardholders.
74.3 percent said credit lines remained basically unchanged.
The complete results of the Federal Reserve's quarterly Senior Loan Officer Opinion Survey on Bank Lending Practices can be found here: