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Lending standards remain tight for US banks: survey

MOST US banks kept lending standards unchanged while loan demand weakened in the first quarter, a US Federal Reserve survey showed yesterday, pointing to lingering weakness in credit markets.

The Fed’s quarterly Senior Loan Officer Survey found banks with assets above $20bn (£13.1bn) easing some lending policies.

With regard to lending to households, large banks eased standards for mortgage and home equity lines of credit, while smaller banks tightened standards for those two categories of lending.

“Most of the banks that reported having eased some lending policies in the April survey were large banks,” the Fed said in its quarterly survey based on responses from 56 US banks and the US branches of 23 foreign banks.

The April survey also showed that banks have tightened terms on business credit card loans to small firms.