Business Credit in 2001: More Available than in Past Recessions

摘要

Commercial and industrial (C&I) lending at commercial banks declined sharply in 2001, raising some concerns about the condition of commercial credit availability during this recession. This study finds that in spite of weaker C&I lending activities, overall commercial credit remains much more available than in other recent recessions. Faced with tighter bank underwriting standards, large borrowers have been able to meet their financing needs in 2001 by tapping the capital markets. Large banking organizations, for their part, can provide access to financing through channels other than bank lending. Data show that smaller commercial borrowers continued to rely on bank credit throughout 2001. Most commercial banks remain well capitalized, which should enable them continue to provide loans to credit worthy borrowers throughout this recession.