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Cautious U.S. Banks Could Limit Consumer Credit This Holiday Season Nov 11
Standard & Poors, Nov 2011
Abstract
How willing and able are banks to extend credit? Consumer spending this holiday season will likely depend on the answer. The definition of a risky borrower has broadened, giving banks less incentive to lend to consumers with weaker credit scores. That's not to say, however, that U.S. consumers aren't spending. In fact, overall spending is moderately higher than it was a year ago, and Standard & Poor's Ratings Services believes that trend is likely to continue this holiday season. Delinquency data shows that borrowers have been better at keeping current on their debt payments than at any time since the onset of the recent recession, which suggests that problem loans in bank portfolios are waning. But as the economy continues...
Companies mentioned in this report are: Bank of America Corp.,JPMorgan Chase & Co.,Discover Financial Services Inc.
Standard and Poors RatingsXpress Credit Research provides in-depth coverage of international corporates, financial institutions, insurance companies, utilities, sovereigns and structured finance programs. RatingsXpress Credit Research lets users determine the credit rating of holdings and identify key factors underlying an issuer's creditworthiness, distinguishes the different risk exposures for new and existing deals, and provides an understanding of how their analysts interpret key regulatory, political and environmental events and their economic impact.
Research Type: Commentary
Criteria articles describe the thought process and methodology Standard & Poor's analysts use in determining ratings. These commentary pieces discuss both the quantitative (economic and financial) and qualitative (business analysis and caliber of management) aspects of the analysis, as well as legal issues.
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