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  4. The January 2023 Senior Loan Officer Opinion Survey on Bank Lending Practices

Senior Loan Officer Opinion Survey on Bank Lending Practices

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Senior Loan Officer Opinion Survey on Bank Lending Practices at Selected Branches and Agencies of Foreign Banks in the United States 1

(Status of Policy as of January 2023)

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 - changed?

 

  All Respondents
Banks Percent
Tightened considerably 1 5.6
Tightened somewhat 5 27.8
Remained basically unchanged 12 66.7
Eased somewhat 0 0.0
Eased considerably 0 0.0
Total 18 100

 

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

 

a. Maximum size of credit lines

  All Respondents
Banks Percent
Tightened considerably 0 0.0
Tightened somewhat 2 13.3
Remained basically unchanged 13 86.7
Eased somewhat 0 0.0
Eased considerably 0 0.0
Total 15 100

b. Maximum maturity of loans or credit lines

  All Respondents
Banks Percent
Tightened considerably 0 0.0
Tightened somewhat 2 13.3
Remained basically unchanged 13 86.7
Eased somewhat 0 0.0
Eased considerably 0 0.0
Total 15 100

c. Costs of credit lines

  All Respondents
Banks Percent
Tightened considerably 0 0.0
Tightened somewhat 10 62.5
Remained basically unchanged 6 37.5
Eased somewhat 0 0.0
Eased considerably 0 0.0
Total 16 100

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

  All Respondents
Banks Percent
Tightened considerably 0 0.0
Tightened somewhat 8 50.0
Remained basically unchanged 8 50.0
Eased somewhat 0 0.0
Eased considerably 0 0.0
Total 16 100

e. Premiums charged on riskier loans

  All Respondents
Banks Percent
Tightened considerably 1 6.7
Tightened somewhat 6 40.0
Remained basically unchanged 7 46.7
Eased somewhat 1 6.7
Eased considerably 0 0.0
Total 15 100

f. Loan covenants

  All Respondents
Banks Percent
Tightened considerably 0 0.0
Tightened somewhat 5 33.3
Remained basically unchanged 10 66.7
Eased somewhat 0 0.0
Eased considerably 0 0.0
Total 15 100

g. Collateralization requirements

  All Respondents
Banks Percent
Tightened considerably 0 0.0
Tightened somewhat 2 13.3
Remained basically unchanged 13 86.7
Eased somewhat 0 0.0
Eased considerably 0 0.0
Total 15 100

h. Use of interest rate floors (more use=tightened, less use=eased)

  All Respondents
Banks Percent
Tightened considerably 0 0.0
Tightened somewhat 2 13.3
Remained basically unchanged 13 86.7
Eased somewhat 0 0.0
Eased considerably 0 0.0
Total 15 100

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.)

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

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

  All Respondents
Banks Percent
Not Important 6 85.7
Somewhat Important 1 14.3
Very Important 0 0.0
Total 7 100

b. Less favorable or more uncertain economic outlook

  All Respondents
Banks Percent
Not Important 0 0.0
Somewhat Important 7 70.0
Very Important 3 30.0
Total 10 100

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

  All Respondents
Banks Percent
Not Important 4 50.0
Somewhat Important 4 50.0
Very Important 0 0.0
Total 8 100

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

  All Respondents
Banks Percent
Not Important 7 87.5
Somewhat Important 1 12.5
Very Important 0 0.0
Total 8 100

e. Reduced tolerance for risk

  All Respondents
Banks Percent
Not Important 4 44.4
Somewhat Important 4 44.4
Very Important 1 11.1
Total 9 100

f. Decreased liquidity in the secondary market for these loans

  All Respondents
Banks Percent
Not Important 6 66.7
Somewhat Important 3 33.3
Very Important 0 0.0
Total 9 100

g. Deterioration in your bank's current or expected liquidity position

  All Respondents
Banks Percent
Not Important 7 87.5
Somewhat Important 1 12.5
Very Important 0 0.0
Total 8 100

h. Increased concerns about the effects of legislative changes, supervisory actions, or accounting standards

  All Respondents
Banks Percent
Not Important 8 100.0
Somewhat Important 0 0.0
Very Important 0 0.0
Total 8 100

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

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

Responses are not reported when the number of respondents is 3 or fewer.

b. More favorable or less uncertain economic outlook

Responses are not reported when the number of respondents is 3 or fewer.

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

Responses are not reported when the number of respondents is 3 or fewer.

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

Responses are not reported when the number of respondents is 3 or fewer.

e. Increased tolerance for risk

Responses are not reported when the number of respondents is 3 or fewer.

f. Increased liquidity in the secondary market for these loans

Responses are not reported when the number of respondents is 3 or fewer.

g. Improvement in your bank's current or expected liquidity position

Responses are not reported when the number of respondents is 3 or fewer.

h. Reduced concerns about the effects of legislative changes, supervisory actions, or accounting standards

Responses are not reported when the number of respondents is 3 or fewer.

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.)

 

  All Respondents
Banks Percent
Substantially stronger 0 0.0
Moderately stronger 2 11.8
About the same 9 52.9
Moderately weaker 5 29.4
Substantially weaker 1 5.9
Total 17 100

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? (Please respond to either A, B, or both as appropriate.)

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

a. Customer inventory financing needs increased

Responses are not reported when the number of respondents is 3 or fewer.

b. Customer accounts receivable financing needs increased

Responses are not reported when the number of respondents is 3 or fewer.

c. Customer investment in plant or equipment increased

Responses are not reported when the number of respondents is 3 or fewer.

d. Customer internally generated funds decreased

Responses are not reported when the number of respondents is 3 or fewer.

e. Customer merger or acquisition financing needs increased

Responses are not reported when the number of respondents is 3 or fewer.

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

Responses are not reported when the number of respondents is 3 or fewer.

g. Customer precautionary demand for cash and liquidity increased

Responses are not reported when the number of respondents is 3 or fewer.

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

a. Customer inventory financing needs decreased

  All Respondents
Banks Percent
Not important 3 60.0
Somewhat important 2 40.0
Very important 0 0.0
Total 5 100

b. Customer accounts receivable financing needs decreased

  All Respondents
Banks Percent
Not important 4 80.0
Somewhat important 1 20.0
Very important 0 0.0
Total 5 100

c. Customer investment in plant or equipment decreased

  All Respondents
Banks Percent
Not important 1 20.0
Somewhat important 4 80.0
Very important 0 0.0
Total 5 100

d. Customer internally generated funds increased

  All Respondents
Banks Percent
Not important 5 100.0
Somewhat important 0 0.0
Very important 0 0.0
Total 5 100

e. Customer merger or acquisition financing needs decreased

  All Respondents
Banks Percent
Not important 1 16.7
Somewhat important 4 66.7
Very important 1 16.7
Total 6 100

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

  All Respondents
Banks Percent
Not important 4 80.0
Somewhat important 1 20.0
Very important 0 0.0
Total 5 100

g. Customer precautionary demand for cash and liquidity decreased

  All Respondents
Banks Percent
Not important 4 80.0
Somewhat important 1 20.0
Very important 0 0.0
Total 5 100

6. At your bank, apart from normal seasonal variation, 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 or increased C&I lines as opposed to the refinancing of existing loans.)

 

  All Respondents
Banks Percent
The number of inquiries has increased substantially 0 0.0
The number of inquiries has increased moderately 1 5.6
The number of inquiries has stayed about the same 12 66.7
The number of inquiries has decreased moderately 4 22.2
The number of inquiries has decreased substantially 1 5.6
Total 18 100

Questions 7-8 ask about commercial real estate (CRE) loans at your bank, including construction and land development loans and loans secured by nonfarm nonresidential properties. Question 7 deals with changes in your bank's standards over the past three months. Question 8 deals with changes in demand. If your bank's lending standards or terms have not changed over the relevant period, please report them as unchanged even if they are either restrictive or accommodative relative to longer-term norms. If your bank's standards or terms have tightened or eased over the relevant period, please so report them regardless of how they stand relative to longer-term norms. Also, please report changes in enforcement of existing standards as changes in standards.

7. Over the past three months, how have your bank's credit standards for approving applications for CRE loans or credit lines changed?

 

  All Respondents
Banks Percent
Tightened considerably 0 0.0
Tightened somewhat 2 15.4
Remained basically unchanged 11 84.6
Eased somewhat 0 0.0
Eased considerably 0 0.0
Total 13 100

For this question, 4 respondents answered "My bank does not originate CRE loans."

8. Apart from normal seasonal variation, how has demand for CRE loans or credit lines changed over the past three months? (Please consider the number of requests for new spot loans, for disbursement of funds under existing loan commitments, and for new or increased credit lines.)

 

  All Respondents
Banks Percent
Substantially stronger 0 0.0
Moderately stronger 1 7.7
About the same 10 76.9
Moderately weaker 2 15.4
Substantially weaker 0 0.0
Total 13 100

Questions 9-10 ask how your bank expects its lending standards for select categories of C&I and commercial real estate loans to change over 2023. Question 11 asks about the reasons why your bank expects lending standards to change.

9. Assuming that economic activity progresses in line with consensus forecasts, how does your bank expect its lending standards for the following C&I loan categories to change over 2023 compared to its current standards, apart from normal seasonal variation?

A. Compared to my bank's current lending standards, over 2023, my bank expects its lending standards for approving applications for C&I loans or credit lines to large and middle-market firms to:

  All Respondents
Banks Percent
Tighten considerably 0 0.0
Tighten somewhat 7 38.9
Remain basically unchanged 10 55.6
Ease somewhat 1 5.6
Ease considerably 0 0.0
Total 18 100

 

B. Compared to my bank's current lending standards, over 2023, my bank expects its lending standards for approving applications for C&I loans or credit lines to small firms to:

  All Respondents
Banks Percent
Tighten considerably 0 0.0
Tighten somewhat 4 44.4
Remain basically unchanged 4 44.4
Ease somewhat 1 11.1
Ease considerably 0 0.0
Total 9 100

For this question, 8 respondents answered "My bank does not originate C&I loans or credit lines to small firms"

10. Assuming that economic activity progresses in line with consensus forecasts, how does your bank expect its lending standards for the following commercial real estate loan categories to change over 2023 compared to its current standards, apart from normal seasonal variation?

A. Compared to my bank's current lending standards, over 2023, my bank expects its lending standards for approving applications for construction and land development loans or credit lines to:

  All Respondents
Banks Percent
Tighten considerably 0 0.0
Tighten somewhat 3 30.0
Remain basically unchanged 7 70.0
Ease somewhat 0 0.0
Ease considerably 0 0.0
Total 10 100

For this question, 6 respondents answered "My bank does not originate construction and land development loans or credit lines"

B. Compared to my bank's current lending standards, over 2023, my bank expects its lending standards for approving applications for loans secured by nonfarm nonresidential properties to:

  All Respondents
Banks Percent
Tighten considerably 0 0.0
Tighten somewhat 5 41.7
Remain basically unchanged 7 58.3
Ease somewhat 0 0.0
Ease considerably 0 0.0
Total 12 100

For this question, 5 respondents answered "My bank does not originate loans secured by nonfarm nonresidential properties"

C. Compared to my bank's current lending standards, over 2023, my bank expects its lending standards for approving applications for loans secured by multifamily residential properties to:

  All Respondents
Banks Percent
Tighten considerably 0 0.0
Tighten somewhat 4 36.4
Remain basically unchanged 7 63.6
Ease somewhat 0 0.0
Ease considerably 0 0.0
Total 11 100

For this question, 6 respondents answered "My bank does not originate loans secured by multifamily residential properties"

11. If your bank expects to tighten or ease its lending standards for any of the loan categories reported in questions 9-10, how important are the following possible reasons for the expected change in standards? (Please respond to either A, B or both as appropriate.)

A. Possible reasons for expecting to tighten lending standards:

a. Expected deterioration in customers collateral values

  All Respondents
Banks Percent
Not important 2 22.2
Somewhat important 6 66.7
Very important 1 11.1
Total 9 100

b. Expected reduction in competition from other banks or nonbank lenders

  All Respondents
Banks Percent
Not important 6 75.0
Somewhat important 1 12.5
Very important 1 12.5
Total 8 100

c. Expected reduction in risk tolerance

  All Respondents
Banks Percent
Not important 2 25.0
Somewhat important 6 75.0
Very important 0 0.0
Total 8 100

d. Expected reduction in ease of selling loans in the secondary market

  All Respondents
Banks Percent
Not important 4 44.4
Somewhat important 5 55.6
Very important 0 0.0
Total 9 100

e. Expected deterioration in credit quality of loan portfolio

  All Respondents
Banks Percent
Not important 4 44.4
Somewhat important 3 33.3
Very important 2 22.2
Total 9 100

f. Increased concerns about the adverse effects of legislative changes, supervisory actions, or changes in accounting standards

  All Respondents
Banks Percent
Not important 8 100.0
Somewhat important 0 0.0
Very important 0 0.0
Total 8 100

g. Expected decrease in your banks net interest margin

  All Respondents
Banks Percent
Not important 8 100.0
Somewhat important 0 0.0
Very important 0 0.0
Total 8 100

h. Expected deterioration in your banks capital or liquidity position due to higher interest rates

  All Respondents
Banks Percent
Not important 6 75.0
Somewhat important 2 25.0
Very important 0 0.0
Total 8 100

i. Expected deterioration in your banks capital or liquidity position due to reasons other than higher interest rates

  All Respondents
Banks Percent
Not important 6 75.0
Somewhat important 2 25.0
Very important 0 0.0
Total 8 100

B. Possible reasons for expecting to ease lending standards:

a. Expected improvement in customers collateral values

Responses are not reported when the number of respondents is 3 or fewer.

b. Expected increase in competition from other banks or nonbank lenders

Responses are not reported when the number of respondents is 3 or fewer.

c. Expected increase in risk tolerance

Responses are not reported when the number of respondents is 3 or fewer.

d. Expected increase in ease of selling loans in the secondary market

Responses are not reported when the number of respondents is 3 or fewer.

e. Expected improvement in credit quality of loan portfolio

Responses are not reported when the number of respondents is 3 or fewer.

f. Reduced concerns about the adverse effects of legislative changes, supervisory actions, or changes in accounting standards

Responses are not reported when the number of respondents is 3 or fewer.

g. Expected increase in your banks net interest margin

Responses are not reported when the number of respondents is 3 or fewer.

h. Expected improvement in your banks capital or liquidity position due to lower interest rates

Responses are not reported when the number of respondents is 3 or fewer.

i. Expected improvement in your banks capital or liquidity position due to reasons other than lower interest rates

Responses are not reported when the number of respondents is 3 or fewer.

Questions 12-13 ask how your bank expects demand for select categories of C&I and commercial real estate loans from your bank to change over 2023. Question 14 asks about the reasons why your bank expects demand from your bank to change.

12. Assuming that economic activity progresses in line with consensus forecasts, how does your bank expect demand for the following categories of C&I loans from your bank to change over 2023 compared to its current level, apart from normal seasonal variation?

A. Compared to its current level, over 2023, my bank expects demand for C&I loans or credit lines to large and middle-market firms from my bank to:

  All Respondents
Banks Percent
Strengthen substantially 0 0.0
Strengthen somewhat 5 27.8
Remain basically unchanged 8 44.4
Weaken somewhat 5 27.8
Weaken substantially 0 0.0
Total 18 100

B. Compared to its current level, over 2023, my bank expects demand for C&I loans or credit lines to small firms from my bank to:

  All Respondents
Banks Percent
Strengthen substantially 0 0.0
Strengthen somewhat 1 12.5
Remain basically unchanged 5 62.5
Weaken somewhat 2 25.0
Weaken substantially 0 0.0
Total 8 100

13. Assuming that economic activity progresses in line with consensus forecasts, how does your bank expect demand for the following categories of commercial real estate loans from your bank to change over 2023 compared to its current level, apart from normal seasonal variation?

A. Compared to its current level, over 2023, my bank expects demand for construction and land development loans or credit lines from my bank to:

  All Respondents
Banks Percent
Strengthen substantially 0 0.0
Strengthen somewhat 1 10.0
Remain basically unchanged 7 70.0
Weaken somewhat 2 20.0
Weaken substantially 0 0.0
Total 10 100

B. Compared to its current level, over 2023, my bank expects demand for loans secured by nonfarm nonresidential properties from my bank to:

  All Respondents
Banks Percent
Strengthen substantially 0 0.0
Strengthen somewhat 1 8.3
Remain basically unchanged 9 75.0
Weaken somewhat 2 16.7
Weaken substantially 0 0.0
Total 12 100

C. Compared to its current level, over 2023, my bank expects demand for loans secured by multifamily residential properties from my bank to:

  All Respondents
Banks Percent
Strengthen substantially 0 0.0
Strengthen somewhat 1 9.1
Remain basically unchanged 9 81.8
Weaken somewhat 1 9.1
Weaken substantially 0 0.0
Total 11 100

14. If your bank expects demand from your bank to change over 2023 compared to its current level and apart from normal seasonal variation for any of the loan categories reported in questions 12-13, how important are the following possible reasons for the expected change in demand? (Please respond to either A, B or both as appropriate.)

A. Possible reasons for expecting stronger loan demand:

a. Customers are expected to face higher spending or investment needs due to more favorable or less uncertain income prospects

  All Respondents
Banks Percent
Not important 5 100.0
Somewhat important 0 0.0
Very important 0 0.0
Total 5 100

b. Customer precautionary demand for cash and liquidity is expected to increase

  All Respondents
Banks Percent
Not important 2 40.0
Somewhat important 3 60.0
Very important 0 0.0
Total 5 100

c. Supply chain disruptions are expected to worsen, strengthening loan demand to acquire inventory or make advanced purchases

  All Respondents
Banks Percent
Not important 2 50.0
Somewhat important 2 50.0
Very important 0 0.0
Total 4 100

d. Supply chain disruptions are expected to ease, strengthening loan demand due to better product availability or lower prices

  All Respondents
Banks Percent
Not important 3 75.0
Somewhat important 1 25.0
Very important 0 0.0
Total 4 100

e. Interest rates are expected to decline, strengthening loan demand

  All Respondents
Banks Percent
Not important 5 83.3
Somewhat important 1 16.7
Very important 0 0.0
Total 6 100

f. More favorable terms other than interest rates are expected to increase loan demand

  All Respondents
Banks Percent
Not important 4 100.0
Somewhat important 0 0.0
Very important 0 0.0
Total 4 100

g. Customer spending or investment needs are expected to increase for reasons not listed above

  All Respondents
Banks Percent
Not important 4 66.7
Somewhat important 2 33.3
Very important 0 0.0
Total 6 100

h. Customer borrowing is expected to shift to your bank from other bank sources because these other sources become less attractive

  All Respondents
Banks Percent
Not important 4 80.0
Somewhat important 0 0.0
Very important 1 20.0
Total 5 100

i. Customer borrowing is expected to shift to your bank from other nonbank sources because these other sources become less attractive

  All Respondents
Banks Percent
Not important 3 60.0
Somewhat important 1 20.0
Very important 1 20.0
Total 5 100

B. Possible reasons for expecting weaker loan demand:

a. Customers are expected to face lower spending or investment needs due to less favorable or more uncertain income prospects

  All Respondents
Banks Percent
Not important 0 0.0
Somewhat important 5 83.3
Very important 1 16.7
Total 6 100

b. Customer precautionary demand for cash and liquidity is expected to decrease

  All Respondents
Banks Percent
Not important 6 100.0
Somewhat important 0 0.0
Very important 0 0.0
Total 6 100

c. Supply chain disruptions are expected to ease, weakening loan demand to acquire inventory or make advanced purchases

  All Respondents
Banks Percent
Not important 4 66.7
Somewhat important 2 33.3
Very important 0 0.0
Total 6 100

d. Supply chain disruptions are expected to worsen, weakening loan demand due to lack of product availability or higher prices

  All Respondents
Banks Percent
Not important 6 85.7
Somewhat important 1 14.3
Very important 0 0.0
Total 7 100

e. Interest rates are expected to increase, weakening loan demand

  All Respondents
Banks Percent
Not important 1 14.3
Somewhat important 3 42.9
Very important 3 42.9
Total 7 100

f. Less favorable terms other than interest rates are expected to reduce loan demand

  All Respondents
Banks Percent
Not important 2 33.3
Somewhat important 3 50.0
Very important 1 16.7
Total 6 100

g. Customer spending or investment needs are expected to decrease for reasons not listed above

  All Respondents
Banks Percent
Not important 4 66.7
Somewhat important 2 33.3
Very important 0 0.0
Total 6 100

h. Customer borrowing is expected to shift from your bank to other bank sources because these other sources become more attractive

  All Respondents
Banks Percent
Not important 5 83.3
Somewhat important 1 16.7
Very important 0 0.0
Total 6 100

i. Customer borrowing is expected to shift from your bank to other nonbank sources because these other sources become more attractive

  All Respondents
Banks Percent
Not important 6 100.0
Somewhat important 0 0.0
Very important 0 0.0
Total 6 100

Questions 15-16 ask about your bank's expectations for the behavior of loan delinquencies and charge-offs on selected categories of C&I and commercial real estate loans in 2023.

15. Assuming that economic activity progresses in line with consensus forecasts, what is your outlook for delinquencies and charge-offs on your bank's C&I loans in the following categories in 2023?

A. The quality of my bank's syndicated nonleveraged C&I loans to large and middle-market firms over 2023, as measured by my bank's outlook for delinquencies and charge-offs on these loans, is likely to:

  All Respondents
Banks Percent
Improve substantially 0 0.0
Improve somewhat 0 0.0
Remain around current levels 13 76.5
Deteriorate somewhat 4 23.5
Deteriorate substantially 0 0.0
Total 17 100

B. The quality of my bank's syndicated leveraged C&I loans to large and middle-market firms over 2023, as measured by my bank's outlook for delinquencies and charge-offs on these loans, is likely to:

  All Respondents
Banks Percent
Improve substantially 0 0.0
Improve somewhat 0 0.0
Remain around current levels 11 64.7
Deteriorate somewhat 6 35.3
Deteriorate substantially 0 0.0
Total 17 100

C. The quality of my bank's nonsyndicated C&I loans to large and middle-market firms over 2023, as measured by my bank's outlook for delinquencies and charge-offs on these loans, is likely to:

  All Respondents
Banks Percent
Improve substantially 0 0.0
Improve somewhat 0 0.0
Remain around current levels 11 64.7
Deteriorate somewhat 6 35.3
Deteriorate substantially 0 0.0
Total 17 100

D. The quality of my bank's C&I loans to small firms over 2023, as measured by my bank's outlook for delinquencies and charge-offs on these loans, is likely to:

  All Respondents
Banks Percent
Improve substantially 0 0.0
Improve somewhat 0 0.0
Remain around current levels 10 83.3
Deteriorate somewhat 2 16.7
Deteriorate substantially 0 0.0
Total 12 100

16. Assuming that economic activity progresses in line with consensus forecasts, what is your outlook for delinquencies and charge-offs on your bank's commercial real estate loans in the following categories in 2023?

A. The quality of my bank's construction and land development loans over 2023, as measured by my bank's outlook for delinquencies and charge-offs on these loans, is likely to:

  All Respondents
Banks Percent
Improve substantially 0 0.0
Improve somewhat 0 0.0
Remain around current levels 9 81.8
Deteriorate somewhat 2 18.2
Deteriorate substantially 0 0.0
Total 11 100

B. The quality of my bank's loans secured by nonfarm nonresidential properties over 2023, as measured by my bank's outlook for delinquencies and charge-offs on these loans, is likely to:

  All Respondents
Banks Percent
Improve substantially 0 0.0
Improve somewhat 0 0.0
Remain around current levels 9 64.3
Deteriorate somewhat 5 35.7
Deteriorate substantially 0 0.0
Total 14 100

C. The quality of my bank's loans secured by multifamily residential properties over 2023, as measured by my bank's outlook for delinquencies and charge-offs on these loans, is likely to:

  All Respondents
Banks Percent
Improve substantially 0 0.0
Improve somewhat 0 0.0
Remain around current levels 11 84.6
Deteriorate somewhat 2 15.4
Deteriorate substantially 0 0.0
Total 13 100

1. As of September 30, 2022, the 18 respondents had combined assets of $1.4 trillion, compared to $3 trillion for all foreign-related banking institutions in the United States. The sample is selected from among the largest foreign-related banking institutions in those Federal Reserve Districts where such institutions are common. Return to text

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Last Update: February 06, 2023