Treasury Report Shows Lending by TARP Recipients Remains Constricted

Real Estate Agent with Palatium Auction and Appraisal Service, Real Estate Auctions, Estate, Moving, Downsizing Auctions 618-233-1000 USPAP Appraisals

New loans made by the nine U.S. banks with the largest unsettled government bailouts declined 35 percent from December to January, according to federal data released this week.

The Treasury’s monthly lending survey of the top Troubled Asset Relief Program (TARP) recipients with funds outstanding shows that collectively the nine banks in the upper echelon originated approximately $36 billion in new loans during the first month of this year.

It was the smallest total since last October, when administration officials reported originations of $41.6 billion. Treasury said the decline may be partially explained by large increases in originations from November to December 2009.

Credit extended by the nine lenders for real estate loans dropped in all categories. Residential home purchase originations plummeted 41 percent, while mortgage refinancings fell 17 percent and secondary home equity loans tumbled 22 percent. Respondents noted that the pool of qualified home equity borrowers has declined as home values have depreciated, noting that demand for such loans remains below 2008 levels.

Treasury said in its report that demand for new commercial real estate (CRE) loans remains low due to the lack of new construction activity. Real estate developers are reluctant to begin new projects or purchase existing projects under current economic conditions, which include a surplus of office space as firms downsize and vacancies rise.

According to the Treasury report, many respondents noted that their focus in the CRE sector has been on renewing and restructuring existing loans as opposed to making new commitments, but both areas suffered considerable declines. Total renewals of existing CRE accounts by the banks surveyed decreased 56 percent from December to January. Total new CRE commitments plummeted 61 percent.

The Treasury’s January lending survey includes data from Citigroup, Comerica, Fifth Third, Hartford, Keycorp, Marshall & Ilsley, PNC, Regions, and SunTrust. According to the report, CIT Group did not file January 2010 data as a result of ongoing bankruptcy proceedings.

Read the story

Posted by

Paul Roesch
Realtor, Auctioneer, CAI, AARE, CES, GPPA, ATS
Marketing Director 
Certified Distressed Property Expert, CDPE
618-407-8479 cell

 Add me as a Friend on Facebook Paul M. Roesch                                                                        

Free Sign Bidder Early Bird Notification of Upcoming Auctions

Auctionitnow  Father Time Auctions St Louis MO

All original text, video, and photo content is the exclusive property of Paul Roesch and / or Palatium Auctions (the Company) and may not be used without expressed written permission. All information deemed reliable but not guaranteed. All personal, real and intellectual property is subject to prior sale, change or withdrawal. Neither the Company or information provider(s) shall be responsible for any typographical errors, misinformation, and misprints and shall be held totally harmless. Listing(s) information is provided for consumers personal, non-commercial use and may not be used for any purpose other than to identify prospective properties consumers may be interested in purchasing. The Company has no control over the quality, safety or legality of the Auction Items listed, the truth or accuracy of the listings or any other information provided by Sellers about the Items. Listings may be sold, withdrawn at any time or subject to change without notice.

Comments (0)