Fed survey: Lending standards expected to ease in 2021

The Federal Reserve’s fourth-quarter senior loan officer opinion survey (SLOOS) revealed that banks expect to ease lending standards this year, following a year-long trend of tightening due to the economic effects of the coronavirus pandemic.

“Bank loan officers are anticipating easing standards on consumer loans this year, despite expecting rising delinquencies,” said NAFCU Chief Economist and Vice President of Research Curt Long. “That outcome would contrast with the financial crisis, where the tightening cycle lasted from 2007 through 2010.

“Nevertheless, the fact that high-income households have fared so much better than low-income ones over the past year means that there may still be a lack of access to credit for low-income households even if underwriting standards do ease somewhat this year,” Long added.

Here’s a look at some key findings from the fourth-quarter survey:

 

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