WASHINGTON — Lending in most parts of the country remained unchanged even as credit standards became slightly tighter, according to a Federal Reserve Board survey released Wednesday.
The central bank's latest Beige Book survey of economic conditions found that demand remained mostly the same with some slight improvements, but that a few districts in the country — New York, St. Louis and Kansas City — cited weaker lending in the most recent quarter.
New York, for example, reported household demand for both consumer loan and mortgages were down in its district. It did, however, see improvements in its commercial mortgages.
"The decrease was most prevalent for residential mortgages," the survey said.
St. Louis reported sluggish demand across most segments including real estate and personal loans.
Total loans outstanding at a sample of small- and mid-sized banks in the district fell 3.2% in the three-month period from mid-December to mid-March. Real estate lending declined by 1.3%, while commercial and industrial loans fell 8.7% in the district.
Banks in the Chicago district noted that their pipeline was still "not robust," although manufacturing, food processing, and healthcare were seeing some growth.
A few contacts in that district also raised concerns about the impact surrounding the uncertainty of Fannie Mae and Freddie Mac had on mortgage credit availability.
Credit standards also remained the same or slightly tighter with competition for quality loans became more intense, several districts said.
"Competition continued to be fierce for high-quality commercial and industrial loans (both large and small) leading to more aggressive terms and pricing," bankers in the Chicago district said, according to the Fed's survey.
The Dallas and San Francisco districts said competition was equally as intense putting downward pressure on rates and fees.
"Most contacts said loan pricing remains aggressive amidst a highly competitive lending landscape," the Fed said of the Dallas district. "Outlooks are gradually improving in light of better outstanding loan quality and continued slow progress in lending conditions."
