The Lending Practice

Businesses Are Loading Up on Credit. Spending Could Follow.

At JPMorgan and Bank of America, undrawn credit commitments total nearly $1 trillion, a 20% increase from a year ago

Credit

Businesses Are Loading Up on Credit. Spending Could Follow. Businesses are sitting on record amounts of unused credit from U.S. banks, another quirk in the economic recovery that bankers say could help unleash pent-up spending in the coming months.

Red flags abound in syndicated lending

About 12.4% of loans in the syndicated credit market last year were deemed “classified” or “special mention” — nearly double the 6.9% seen one year earlier, the report from the Federal Reserve, the Federal Deposit Insurance Corp. and the Office of the Comptroller of the Currency showed.

Red flags abound in syndicated lending Shared national credit balances rose 5% last year, and the percentage of at-risk loans nearly doubled. Regulators point out that banks have stashed away extra capital, but a lot will depend on the speed of the economic recovery and the performance of nonbank loans.