Senior Loan Officer Opinion Survey on Bank Lending Practices
January 2008

Table 1

Senior Loan Officer Opinion Survey on Bank Lending Practices
at Selected Large Banks in the United States ¹

(Status of policy as of January 2008)

Questions 1-6 ask about commercial and industrial (C&I) loans at your bank. Questions 1-3 deal with changes in your bank's lending policies over the past three months. Questions 4-5 deal with changes in demand for C&I loans over the past three months. Question 6 asks about changes in prospective demand for C&I loans at your bank, as indicated by the volume of recent inquiries about the availability of new credit lines or increases in existing lines. If your bank's lending policies have not changed over the past three months, please report them as unchanged even if the policies are either restrictive or accommodative relative to longer-term norms. If your bank's policies have tightened or eased over the past three months, please so report them regardless of how they stand relative to longer-term norms. Also, please report changes in enforcement of existing policies as changes in policies.

1. Over the past three months, how have your bank's credit standards for approving applications for C&I loans or credit lines--other than those to be used to finance mergers and acquisitions--to large and middle-market firms and to small firms changed? (If your bank defines firm size differently from the categories suggested below, please use your definitions and indicate what they are.)

a. Standards for large and middle-market firms (annual sales of $50 million or more):

	All Respondents		Large Banks		Other Banks
	Banks	Percent	Banks	Percent	Banks	Percent
Tightened considerably	1	1.8	1	3.0	0	0.0
Tightened somewhat	17	30.4	8	24.2	9	39.1
Remained basically unchanged	38	67.9	24	72.7	14	60.9
Eased somewhat	0	0.0	0	0.0	0	0.0
Eased considerably	0	0.0	0	0.0	0	0.0
Total	56	100.0	33	100.0	23	100.0

b. Standards for small firms (annual sales of less than $50 million):

	All Respondents		Large Banks		Other Banks
	Banks	Percent	Banks	Percent	Banks	Percent
Tightened considerably	1	1.8	1	3.0	0	0.0
Tightened somewhat	16	28.6	8	24.2	8	34.8
Remained basically unchanged	39	69.6	24	72.7	15	65.2
Eased somewhat	0	0.0	0	0.0	0	0.0
Eased considerably	0	0.0	0	0.0	0	0.0
Total	56	100.0	33	100.0	23	100.0

2. For applications for C&I loans or credit lines--other than those to be used to finance mergers and acquisitions--from large and middle-market firms and from small firms that your bank currently is willing to approve, how have the terms of those loans changed over the past three months?

A. Terms for large and middle-market firms (annual sales of $50 million or more):

a. Maximum size of credit lines:

	All Respondents		Large Banks		Other Banks
	Banks	Percent	Banks	Percent	Banks	Percent
Tightened considerably	1	1.8	0	0.0	1	4.5
Tightened somewhat	11	20.0	8	24.2	3	13.6
Remained basically unchanged	39	70.9	22	66.7	17	77.3
Eased somewhat	4	7.3	3	9.1	1	4.5
Eased considerably	0	0.0	0	0.0	0	0.0
Total	55	100.0	33	100.0	22	100.0

b. Maximum maturity of loans or credit lines:

	All Respondents		Large Banks		Other Banks
	Banks	Percent	Banks	Percent	Banks	Percent
Tightened considerably	0	0.0	0	0.0	0	0.0
Tightened somewhat	9	16.4	7	21.2	2	9.1
Remained basically unchanged	45	81.8	26	78.8	19	86.4
Eased somewhat	1	1.8	0	0.0	1	4.5
Eased considerably	0	0.0	0	0.0	0	0.0
Total	55	100.0	33	100.0	22	100.0

c. Costs of credit lines:

	All Respondents		Large Banks		Other Banks
	Banks	Percent	Banks	Percent	Banks	Percent
Tightened considerably	3	5.5	2	6.1	1	4.5
Tightened somewhat	22	40.0	13	39.4	9	40.9
Remained basically unchanged	29	52.7	17	51.5	12	54.5
Eased somewhat	1	1.8	1	3.0	0	0.0
Eased considerably	0	0.0	0	0.0	0	0.0
Total	55	100.0	33	100.0	22	100.0

d. Spreads of loan rates over your bank's cost of funds (wider spreads=tightened, narrower spreads=eased):

	All Respondents		Large Banks		Other Banks
	Banks	Percent	Banks	Percent	Banks	Percent
Tightened considerably	2	3.6	2	6.1	0	0.0
Tightened somewhat	25	45.5	14	42.4	11	50.0
Remained basically unchanged	25	45.5	15	45.5	10	45.5
Eased somewhat	3	5.5	2	6.1	1	4.5
Eased considerably	0	0.0	0	0.0	0	0.0
Total	55	100.0	33	100.0	22	100.0

e. Premiums charged on riskier loans:

	All Respondents		Large Banks		Other Banks
	Banks	Percent	Banks	Percent	Banks	Percent
Tightened considerably	5	9.1	4	12.1	1	4.5
Tightened somewhat	24	43.6	15	45.5	9	40.9
Remained basically unchanged	25	45.5	14	42.4	11	50.0
Eased somewhat	1	1.8	0	0.0	1	4.5
Eased considerably	0	0.0	0	0.0	0	0.0
Total	55	100.0	33	100.0	22	100.0

f. Loan covenants:

	All Respondents		Large Banks		Other Banks
	Banks	Percent	Banks	Percent	Banks	Percent
Tightened considerably	1	1.8	0	0.0	1	4.5
Tightened somewhat	16	29.1	10	30.3	6	27.3
Remained basically unchanged	38	69.1	23	69.7	15	68.2
Eased somewhat	0	0.0	0	0.0	0	0.0
Eased considerably	0	0.0	0	0.0	0	0.0
Total	55	100.0	33	100.0	22	100.0

g. Collateralization requirements:

	All Respondents		Large Banks		Other Banks
	Banks	Percent	Banks	Percent	Banks	Percent
Tightened considerably	1	1.8	0	0.0	1	4.5
Tightened somewhat	9	16.4	6	18.2	3	13.6
Remained basically unchanged	44	80.0	27	81.8	17	77.3
Eased somewhat	1	1.8	0	0.0	1	4.5
Eased considerably	0	0.0	0	0.0	0	0.0
Total	55	100.0	33	100.0	22	100.0

B. Terms for small firms (annual sales of less than $50 million):

a. Maximum size of credit lines:

	All Respondents		Large Banks		Other Banks
	Banks	Percent	Banks	Percent	Banks	Percent
Tightened considerably	1	1.9	0	0.0	1	4.8
Tightened somewhat	10	18.5	6	18.2	4	19.0
Remained basically unchanged	41	75.9	26	78.8	15	71.4
Eased somewhat	2	3.7	1	3.0	1	4.8
Eased considerably	0	0.0	0	0.0	0	0.0
Total	54	100.0	33	100.0	21	100.0

b. Maximum maturity of loans or credit lines:

	All Respondents		Large Banks		Other Banks
	Banks	Percent	Banks	Percent	Banks	Percent
Tightened considerably	0	0.0	0	0.0	0	0.0
Tightened somewhat	5	9.1	3	9.1	2	9.1
Remained basically unchanged	49	89.1	30	90.9	19	86.4
Eased somewhat	1	1.8	0	0.0	1	4.5
Eased considerably	0	0.0	0	0.0	0	0.0
Total	55	100.0	33	100.0	22	100.0

c. Costs of credit lines:

	All Respondents		Large Banks		Other Banks
	Banks	Percent	Banks	Percent	Banks	Percent
Tightened considerably	2	3.6	2	6.1	0	0.0
Tightened somewhat	20	36.4	12	36.4	8	36.4
Remained basically unchanged	32	58.2	18	54.5	14	63.6
Eased somewhat	1	1.8	1	3.0	0	0.0
Eased considerably	0	0.0	0	0.0	0	0.0
Total	55	100.0	33	100.0	22	100.0

d. Spreads of loan rates over your bank's cost of funds (wider spreads=tightened, narrower spreads=eased):

	All Respondents		Large Banks		Other Banks
	Banks	Percent	Banks	Percent	Banks	Percent
Tightened considerably	3	5.5	2	6.1	1	4.5
Tightened somewhat	21	38.2	11	33.3	10	45.5
Remained basically unchanged	29	52.7	19	57.6	10	45.5
Eased somewhat	2	3.6	1	3.0	1	4.5
Eased considerably	0	0.0	0	0.0	0	0.0
Total	55	100.0	33	100.0	22	100.0

e. Premiums charged on riskier loans:

	All Respondents		Large Banks		Other Banks
	Banks	Percent	Banks	Percent	Banks	Percent
Tightened considerably	4	7.3	2	6.1	2	9.1
Tightened somewhat	20	36.4	14	42.4	6	27.3
Remained basically unchanged	30	54.5	17	51.5	13	59.1
Eased somewhat	1	1.8	0	0.0	1	4.5
Eased considerably	0	0.0	0	0.0	0	0.0
Total	55	100.0	33	100.0	22	100.0

f. Loan covenants:

	All Respondents		Large Banks		Other Banks
	Banks	Percent	Banks	Percent	Banks	Percent
Tightened considerably	1	1.8	0	0.0	1	4.5
Tightened somewhat	10	18.2	5	15.2	5	22.7
Remained basically unchanged	44	80.0	28	84.8	16	72.7
Eased somewhat	0	0.0	0	0.0	0	0.0
Eased considerably	0	0.0	0	0.0	0	0.0
Total	55	100.0	33	100.0	22	100.0

g. Collateralization requirements:

	All Respondents		Large Banks		Other Banks
	Banks	Percent	Banks	Percent	Banks	Percent
Tightened considerably	1	1.8	0	0.0	1	4.5
Tightened somewhat	8	14.5	4	12.1	4	18.2
Remained basically unchanged	45	81.8	29	87.9	16	72.7
Eased somewhat	1	1.8	0	0.0	1	4.5
Eased considerably	0	0.0	0	0.0	0	0.0
Total	55	100.0	33	100.0	22	100.0

3. If your bank has tightened or eased its credit standards or its terms for C&I loans or credit lines over the past three months (as described in questions 1 and 2), how important have been the following possible reasons for the change? (Please respond to either A, B, or both as appropriate and rate each possible reason using the following scale: 1=not important, 2=somewhat important, 3=very important.)

A. Possible reasons for tightening credit standards or loan terms:

a. Deterioration in your bank's current or expected capital position:

	All Respondents		Large Banks		Other Banks
	Banks	Percent	Banks	Percent	Banks	Percent
Not important	29	76.3	18	78.3	11	73.3
Somewhat important	7	18.4	3	13.0	4	26.7
Very important	2	5.3	2	8.7	0	0.0
Total	38	100.0	23	100.0	15	100.0

b. Less favorable or more uncertain economic outlook:

	All Respondents		Large Banks		Other Banks
	Banks	Percent	Banks	Percent	Banks	Percent
Not important	3	7.7	2	8.3	1	6.7
Somewhat important	23	59.0	15	62.5	8	53.3
Very important	13	33.3	7	29.2	6	40.0
Total	39	100.0	24	100.0	15	100.0

c. Worsening of industry-specific problems (please specify industries):

	All Respondents		Large Banks		Other Banks
	Banks	Percent	Banks	Percent	Banks	Percent
Not important	11	28.2	9	37.5	2	13.3
Somewhat important	15	38.5	7	29.2	8	53.3
Very important	13	33.3	8	33.3	5	33.3
Total	39	100.0	24	100.0	15	100.0

d. Less aggressive competition from other banks or nonbank lenders (other financial intermediaries or the capital markets):

	All Respondents		Large Banks		Other Banks
	Banks	Percent	Banks	Percent	Banks	Percent
Not important	24	63.2	13	56.5	11	73.3
Somewhat important	13	34.2	10	43.5	3	20.0
Very important	1	2.6	0	0.0	1	6.7
Total	38	100.0	23	100.0	15	100.0

e. Reduced tolerance for risk:

	All Respondents		Large Banks		Other Banks
	Banks	Percent	Banks	Percent	Banks	Percent
Not important	7	18.4	5	21.7	2	13.3
Somewhat important	25	65.8	13	56.5	12	80.0
Very important	6	15.8	5	21.7	1	6.7
Total	38	100.0	23	100.0	15	100.0

f. Decreased liquidity in the secondary market for these loans:

	All Respondents		Large Banks		Other Banks
	Banks	Percent	Banks	Percent	Banks	Percent
Not important	20	52.6	9	39.1	11	73.3
Somewhat important	13	34.2	10	43.5	3	20.0
Very important	5	13.2	4	17.4	1	6.7
Total	38	100.0	23	100.0	15	100.0

g. Increase in defaults by borrowers in public debt markets:

	All Respondents		Large Banks		Other Banks
	Banks	Percent	Banks	Percent	Banks	Percent
Not important	25	65.8	15	65.2	10	66.7
Somewhat important	11	28.9	7	30.4	4	26.7
Very important	2	5.3	1	4.3	1	6.7
Total	38	100.0	23	100.0	15	100.0

h. Increased concern about your bank's current or expected liquidity position:

	All Respondents		Large Banks		Other Banks
	Banks	Percent	Banks	Percent	Banks	Percent
Not important	29	76.3	17	73.9	12	80.0
Somewhat important	5	13.2	4	17.4	1	6.7
Very important	4	10.5	2	8.7	2	13.3
Total	38	100.0	23	100.0	15	100.0

B. Possible reasons for easing credit standards or loan terms:

a. Improvement in your bank's current or expected capital position:

	All Respondents		Large Banks		Other Banks
	Banks	Percent	Banks	Percent	Banks	Percent
Not important	5	62.5	3	50.0	2	100.0
Somewhat important	2	25.0	2	33.3	0	0.0
Very important	1	12.5	1	16.7	0	0.0
Total	8	100.0	6	100.0	2	100.0

b. More favorable or less uncertain economic outlook:

	All Respondents		Large Banks		Other Banks
	Banks	Percent	Banks	Percent	Banks	Percent
Not important	4	44.4	3	42.9	1	50.0
Somewhat important	5	55.6	4	57.1	1	50.0
Very important	0	0.0	0	0.0	0	0.0
Total	9	100.0	7	100.0	2	100.0

c. Improvement in industry-specific problems (please specify industries):

	All Respondents		Large Banks		Other Banks
	Banks	Percent	Banks	Percent	Banks	Percent
Not important	6	75.0	5	83.3	1	50.0
Somewhat important	1	12.5	1	16.7	0	0.0
Very important	1	12.5	0	0.0	1	50.0
Total	8	100.0	6	100.0	2	100.0

d. More aggressive competition from other banks or nonbank lenders (other financial intermediaries or the capital markets):

	All Respondents		Large Banks		Other Banks
	Banks	Percent	Banks	Percent	Banks	Percent
Not important	4	44.4	3	42.9	1	50.0
Somewhat important	1	11.1	1	14.3	0	0.0
Very important	4	44.4	3	42.9	1	50.0
Total	9	100.0	7	100.0	2	100.0

e. Increased tolerance for risk:

	All Respondents		Large Banks		Other Banks
	Banks	Percent	Banks	Percent	Banks	Percent
Not important	4	44.4	2	28.6	2	100.0
Somewhat important	4	44.4	4	57.1	0	0.0
Very important	1	11.1	1	14.3	0	0.0
Total	9	100.0	7	100.0	2	100.0

f. Increased liquidity in the secondary market for these loans:

	All Respondents		Large Banks		Other Banks
	Banks	Percent	Banks	Percent	Banks	Percent
Not important	7	87.5	5	83.3	2	100.0
Somewhat important	1	12.5	1	16.7	0	0.0
Very important	0	0.0	0	0.0	0	0.0
Total	8	100.0	6	100.0	2	100.0

g. Reduction in defaults by borrowers in public debt markets:

	All Respondents		Large Banks		Other Banks
	Banks	Percent	Banks	Percent	Banks	Percent
Not important	7	87.5	5	83.3	2	100.0
Somewhat important	1	12.5	1	16.7	0	0.0
Very important	0	0.0	0	0.0	0	0.0
Total	8	100.0	6	100.0	2	100.0

h. Reduced concern about your bank's current or expected liquidity:

	All Respondents		Large Banks		Other Banks
	Banks	Percent	Banks	Percent	Banks	Percent
Not important	6	75.0	4	66.7	2	100.0
Somewhat important	2	25.0	2	33.3	0	0.0
Very important	0	0.0	0	0.0	0	0.0
Total	8	100.0	6	100.0	2	100.0

4. Apart from normal seasonal variation, how has demand for C&I loans changed over the past three months? (Please consider only funds actually disbursed as opposed to requests for new or increased lines of credit.)

a. Demand for C&I loans from large and middle-market firms (annual sales of $50 million or more):

	All Respondents		Large Banks		Other Banks
	Banks	Percent	Banks	Percent	Banks	Percent
Substantially stronger	0	0.0	0	0.0	0	0.0
Moderately stronger	7	12.7	6	18.2	1	4.5
About the same	32	58.2	20	60.6	12	54.5
Moderately weaker	16	29.1	7	21.2	9	40.9
Substantially weaker	0	0.0	0	0.0	0	0.0
Total	55	100.0	33	100.0	22	100.0

b. Demand for C&I loans from small firms (annual sales of less than $50 million):

	All Respondents		Large Banks		Other Banks
	Banks	Percent	Banks	Percent	Banks	Percent
Substantially stronger	0	0.0	0	0.0	0	0.0
Moderately stronger	5	9.1	3	9.1	2	9.1
About the same	32	58.2	19	57.6	13	59.1
Moderately weaker	17	30.9	10	30.3	7	31.8
Substantially weaker	1	1.8	1	3.0	0	0.0
Total	55	100.0	33	100.0	22	100.0

5. If demand for C&I loans has strengthened or weakened over the past three months (as described in question 4), how important have been the following possible reasons for the change?

A. If stronger loan demand (answer 1 or 2 to question 4A or 4B), possible reasons:

a. Customer inventory financing needs increased:

	All Respondents		Large Banks		Other Banks
	Banks	Percent	Banks	Percent	Banks	Percent
Not important	4	44.4	3	42.9	1	50.0
Somewhat important	5	55.6	4	57.1	1	50.0
Very important	0	0.0	0	0.0	0	0.0
Total	9	100.0	7	100.0	2	100.0

b. Customer accounts receivable financing needs increased:

	All Respondents		Large Banks		Other Banks
	Banks	Percent	Banks	Percent	Banks	Percent
Not important	2	22.2	2	28.6	0	0.0
Somewhat important	7	77.8	5	71.4	2	100.0
Very important	0	0.0	0	0.0	0	0.0
Total	9	100.0	7	100.0	2	100.0

c. Customer investment in plant or equipment increased:

	All Respondents		Large Banks		Other Banks
	Banks	Percent	Banks	Percent	Banks	Percent
Not important	3	33.3	3	42.9	0	0.0
Somewhat important	6	66.7	4	57.1	2	100.0
Very important	0	0.0	0	0.0	0	0.0
Total	9	100.0	7	100.0	2	100.0

d. Customer internally generated funds decreased:

	All Respondents		Large Banks		Other Banks
	Banks	Percent	Banks	Percent	Banks	Percent
Not important	4	44.4	3	42.9	1	50.0
Somewhat important	5	55.6	4	57.1	1	50.0
Very important	0	0.0	0	0.0	0	0.0
Total	9	100.0	7	100.0	2	100.0

e. Customer merger or acquisition financing needs increased:

	All Respondents		Large Banks		Other Banks
	Banks	Percent	Banks	Percent	Banks	Percent
Not important	3	33.3	2	28.6	1	50.0
Somewhat important	6	66.7	5	71.4	1	50.0
Very important	0	0.0	0	0.0	0	0.0
Total	9	100.0	7	100.0	2	100.0

f. Customer borrowing shifted to your bank from other bank or nonbank sources because these other sources became less attractive:

	All Respondents		Large Banks		Other Banks
	Banks	Percent	Banks	Percent	Banks	Percent
Not important	5	55.6	4	57.1	1	50.0
Somewhat important	2	22.2	1	14.3	1	50.0
Very important	2	22.2	2	28.6	0	0.0
Total	9	100.0	7	100.0	2	100.0

B. If weaker loan demand (answer 4 or 5 to question 4A or 4B), possible reasons:

a. Customer inventory financing needs decreased:

	All Respondents		Large Banks		Other Banks
	Banks	Percent	Banks	Percent	Banks	Percent
Not important	4	20.0	3	23.1	1	14.3
Somewhat important	15	75.0	9	69.2	6	85.7
Very important	1	5.0	1	7.7	0	0.0
Total	20	100.0	13	100.0	7	100.0

b. Customer accounts receivable financing needs decreased:

	All Respondents		Large Banks		Other Banks
	Banks	Percent	Banks	Percent	Banks	Percent
Not important	8	40.0	6	46.2	2	28.6
Somewhat important	11	55.0	6	46.2	5	71.4
Very important	1	5.0	1	7.7	0	0.0
Total	20	100.0	13	100.0	7	100.0

c. Customer investment in plant or equipment decreased:

	All Respondents		Large Banks		Other Banks
	Banks	Percent	Banks	Percent	Banks	Percent
Not important	1	5.0	1	7.7	0	0.0
Somewhat important	14	70.0	9	69.2	5	71.4
Very important	5	25.0	3	23.1	2	28.6
Total	20	100.0	13	100.0	7	100.0

d. Customer internally generated funds increased:

	All Respondents		Large Banks		Other Banks
	Banks	Percent	Banks	Percent	Banks	Percent
Not important	14	70.0	9	69.2	5	71.4
Somewhat important	5	25.0	3	23.1	2	28.6
Very important	1	5.0	1	7.7	0	0.0
Total	20	100.0	13	100.0	7	100.0

e. Customer merger or acquisition financing needs decreased:

	All Respondents		Large Banks		Other Banks
	Banks	Percent	Banks	Percent	Banks	Percent
Not important	6	30.0	3	23.1	3	42.9
Somewhat important	7	35.0	6	46.2	1	14.3
Very important	7	35.0	4	30.8	3	42.9
Total	20	100.0	13	100.0	7	100.0

f. Customer borrowing shifted from your bank to other bank or nonbank credit sources because these other sources became more attractive:

	All Respondents		Large Banks		Other Banks
	Banks	Percent	Banks	Percent	Banks	Percent
Not important	12	60.0	8	61.5	4	57.1
Somewhat important	4	20.0	3	23.1	1	14.3
Very important	4	20.0	2	15.4	2	28.6
Total	20	100.0	13	100.0	7	100.0

6. At your bank, how has the number of inquiries from potential business borrowers regarding the availability and terms of new credit lines or increases in existing lines changed over the past three months? (Please consider only inquiries for additional C&I lines as opposed to the refinancing of existing loans.)

	All Respondents		Large Banks		Other Banks
	Banks	Percent	Banks	Percent	Banks	Percent
The number of inquiries has increased substantially	0

Senior Loan Officer Opinion Survey on Bank Lending PracticesJanuary 2008

Table 1

Senior Loan Officer Opinion Survey on Bank Lending Practices at Selected Large Banks in the United States 1

(Status of policy as of January 2008)

Senior Loan Officer Opinion Survey on Bank Lending Practices
January 2008

Senior Loan Officer Opinion Survey on Bank Lending Practices
at Selected Large Banks in the United States ¹