Jeffrey Haley, the CEO of American National Bank and Trust Company, saw the crunch coming at the start of 2023.
Rising interest rates and a slowing economy to him meant that loan growth would likely fall by half as the Danville, Virginia-based community bank turned its focus to better-quality, higher-yielding credit, worrying little about volume.
After a year of racing along a virtually unfettered path to higher interest rates, the Federal Reserve is facing its first significant pothole as the decisions made in hundreds of bank executive suites will either add up - or not - to an economy-shaping drop in lending. But the potential for a worse-than-expected credit crunch remains elevated in the wake of the Silicon Valley Bank and Signature Bank collapses last month, which raised concerns of a larger financial panic.
The response - less lending, tighter credit standards and higher interest on loans - was already taking shape. Officials are now watching for signs that has been kicked into overdrive. "Survey data is going to be very important because it's going to give us a sense of whether financial institutions are pulling back even more on their credit standards," Cleveland Fed President Loretta Mester said last week. "We already saw it happening, which you'd expect to see as interest rates moved up ... That was kind of a normal thing."
A Dallas Fed bank conditions survey, conducted in late March after the two bank failures, indicated lending standards in that Fed regional bank's district have kept tightening, with loan demand falling.
South Africa Latest News, South Africa Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Haley blasts 'embarrassing' Afghanistan withdrawal, sent 'terrible image' to worldPresidential candidate Nikki Haley slammed the Biden administration's orchestration of the U.S. military's exit from Afghanistan in a recent interview, recalling that “They were making fun of us. I mean, it set a terrible image throughout the world that we had, we were completely defeated.'
Read more »
Ex-cop, a former prison cellmate of Jeffrey Epstein, convicted for murdering 4 men | CNNA former New York police officer and cellmate of disgraced financier Jeffrey Epstein was found guilty Thursday of killing four men in 2015, the US Attorney for the Southern District of New York announced.
Read more »
Ex-police officer, former cellmate of Jeffrey Epstein convicted of murdering 4 men in 2015The man was convicted of killing four men and burying their bodies in a mass grave in 2015.
Read more »
Florida Teacher Fired After Having Students Write Their Own ObituariesJeffrey Keene said that, despite the outcome, he would still give the assignment again.
Read more »
Florida teacher fired after asking students to write their own obituaries for active shooter drillA Florida teacher was fired hours after he asked students to write their own obituaries ahead of an active shooter drill on campus, the instructor and school district said Friday.
Read more »
Asian shares muted, dollar buoyant on odds of rate riseSome analysts see a disconnect between the Fed's likely path and market expectations.
Read more »