Lenders continue to decrease their exposure to the retail sector, with 37% reporting they pulled away from offering credit to retailers in the past six months, according to a quarterly survey released last week.
Thirty-seven percent also reported they plan to decrease exposure to retail in the next six months. Retailing has led the list of unpopular industries for lenders for seven consecutive quarters, according to the survey by Phoenix Management Services, a Philadelphia turnaround management firm.
Seventy-four respondents from bank and nonbank financial institutions gave the light manufacturing industry high marks; 72% of lenders said they planned to increase marketing of loans to this sector in the next six months.
Service and industrial distribution companies were also attractive. Sixty-six percent of lenders said they would extend credit to the service sector; 64% said they would lend more to distribution firms.
Heavy manufacturing, transportation, and technology companies, particularly those involved in software and communications, were also attractive, the study found.