As we discussed last week, the Federal Reserve’s most recent loan survey indicates bank lending picked up in numerous categories during the second quarter. Economists believe this is good news for the financial industry, as it indicates increasing demand for loan products. It is also good news for the economy, since loan growth is often a sign of improving business confidence and a potential increase in economic growth. Part of the increase in lending is attributable to increased competition from non-bank lenders such as the Chicago-based financing firm Cambridge Realty Capital. Cambridge Realty Capital has over twenty years experience in real estate financing, and currently focuses on the senior housing sector. Senior housing participants seeking capital for acquisitions, joint-ventures, debt refinancing, or for other purposes, should contact Cambridge Realty Capital to learn more about its various loan products, and other financing options as well.
Major Banks Boost Lending
In addition to lending picking up in various categories, the second quarter also marked an increase in lending from ten of the nation’s largest commercial banks. According to SNL Financial, nine of the ten banks experienced loan growth between the first and second quarters of 2014, and eight of the ten experienced loan growth between the second quarter of 2013 and the second quarter of this year. Coinciding with results from the Federal Reserve’s recent loan survey, loan growth occurred across a range of categories, with all ten banks reporting growth in non-real estate lending, eight of the ten reporting growth in multi-family lending, and nine of the ten reporting growth in commercial and industrial lending. Three of the ten experienced particularly strong loan growth in multiple categories and over multiple periods. JPMorgan Chase reported both quarter-over-quarter and year-over-year growth in non-residential construction loans, multi-family loans and commercial real estate loans. PNC Banks reported quarter-over-quarter and year-over-year growth in the aforementioned categories, with double-digit growth occurring in the multifamily sector. SunTrust Bank reported double-digit quarter-over-quarter and year-over-year growth in all three aforementioned categories. Particularly strong was SunTrust’s non-residential lending, which increased by 22.15 percent from 2013’s second quarter to 2014’s second quarter, as well as its commercial real estate lending, which increased by 15.12 percent from 2013’s second quarter to 2014’s second quarter.
In order to meet increased demand for loans, some lenders are making concessions on pricing and other terms which they refused to make in earlier years. They believe that making these concessions now helps strengthen their position in an increasingly competitive market by generating new customers and improving their chances of issuing additional loans to existing customers. As responsible lending increases and the economy continues to grow, more pressure will be put upon the Federal Reserve to raise interest rates. Before this happens, senior housing providers and investors seeking capital to invest in senior housing assets, or for other purposes, should contact Cambridge Realty Capital to learn more about the many different financing programs it offers for a wide variety of transactions.
