If Not Dr. Death At Least Doctor Doom

Back to my theme about the financial sector. From Minyanville today:

Meanwhile, also in reality, there’s the fact that banks continue to tighten lending standards, reducing access to credit at a rapid pace. The Office of the Comptroller of the Currency today released its annual Survey of Credit Underwriting Practices and reported that commercial and retail underwriting standards tightened after four consecutive years of easing underwriting standards.

Some nuggets from the report, which can be found here:

• The majority of the banks surveyed tightened underwriting standards for both commercial and retail loans.
• Primary reasons for tightened standards included the overall economic outlook, the downturn in residential real estate, a changing risk appetite, and a decrease in market liquidity.
• Key factors that contributed to the rise in product and portfolio credit risk were the weakening economy, rising energy costs, turbulence in the secondary credit markets, the downturn in the housing market, and the anticipated impact of relaxed underwriting standards over the past few years on payment performance.

This entry was posted on Thursday, June 12th, 2008 at 12:21 pm and is filed under Investing. You can follow any responses to this entry through the RSS 2.0 feed.