Banks curtail Lending to Small Businesses

From The Epoch Times:
WASHINGTON—During 2010, U.S. banks increased their lending, although most of the credit was extended to large- and medium-sized businesses.

“Research by Greenwich Associates shows credit conditions have become highly favorable for the largest U.S. companies, who currently have ample access to both bank credit facilities and low-interest bond offerings,” according to the latest Greenwich Market Pulse survey.

Banks still think twice before lending to the small-sized business sector, with 50 percent of the Greenwich survey respondents reporting problems in securing loans and one-third reporting a worse borrowing environment than in the beginning of 2010.

“Continued difficulties in securing affordable credit have left many small businesses and weaker mid-sized companies wondering about their ability to sustain their businesses through the year ahead,” according to Greenwich.

The majority of both small and the lower end of mid-sized companies are pessimistic. They foresee a dismal 2011 in securing credit, with equipment purchases and hiring curtailed. One third is even predicting deterioration in the economic environment.


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