The Federal Reserve said U.S. banks reported stricter credit standards in the fourth quarter, although the proportion of those tightening standards shrank from the prior period, Bloomberg News reported. The net share of U.S. banks that tightened standards on commercial and industrial loans for medium and large businesses compared to the prior period dropped to 14.5%, from 33.9% in the third quarter, according to a Fed survey of lending officers released Monday. That was the smallest such share since 2022. About 53% of banks kept lending conditions basically unchanged. While demand for credit remains weak, the net share of banks reporting weaker demand for C&I loans among large and mid-sized firms declined to 25%, an improvement from the third quarter. The figures in the survey, known as the Senior Loan Officer Opinion Survey, are calculated as net percentages, or the shares of banks reporting tighter conditions or stronger demand minus the proportion of banks reporting easier standards or weaker demand. The survey was conducted between Dec. 18 and Jan. 9.
