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Fewer Banks Eased Biz Loan Terms

Fed survey also shows demand weakened for commercial loans in Q3.

By Joshua Zumbrun, Bloomberg | Updated on November 07, 2011

Fewer banks eased standards on loans to businesses in the third quarter, and lenders tightened standards on credit to European banks and their affiliates, according to a Federal Reserve survey.

Banks were slightly more likely to ease than tighten their standards on credit, “in contrast to more widespread reports of such easing in previous quarters,” the central bank said today in its quarterly survey of senior loan officers. Banks that raised their standards “cited a less favorable or more uncertain economic outlook as a reason for the tightening.”

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