A recent survey of bank officers shows U.S. institutions are tightening their lending standards and raising rates on commercial loans and credit cards.
Details: Bankers say they have increasing concern about future economic growth, despite continued U.S. labor market strength and solid economic fundamentals. The data banks are seeing runs contrary to the overall narrative of a strong U.S. economy.
- In the Fed’s latest U.S. bank senior loan officers survey, which provided data from the fourth quarter of 2018, loan officers predicted more delinquencies this year as a result of the growth of “non-prime” borrowers. They’ve cited that as a reason for an anticipated pullback in credit and an increase in rates.
- U.S. card holders are expected to pay $122 billion just in interest charges this year. That’s 50% more than what they paid just 5 years ago.
- The average credit card assessed interest rate is now 16.91%. It was 13.14% in the first quarter of 2014.
- The average interest rate on retail cards is more than 25%.