2023 U.S. Loan Market Survey

A Surfeit of Concerns Weighs on Lenders This Year

Last year was a most challenging time for the global economy and financial markets. Economic relief and other stimulus measures provided by major central banks and governing bodies during the COVID-19 pandemic in 2020-2021 gave way to an inflationary spiral that required a sharp pivot to monetary tightening. While this was intended to quell rising prices, it risks slowing economic growth, perhaps to the point of recession. This phenomenon has played out across the globe and continues in 2023, as the normalization of monetary policy away from easing and massive stimulus has wider-reaching consequences. Against this backdrop, escalating geopolitical risks have injected further uncertainty into the global economic outlook.

Lender respondents in FTI Consulting’s recent U.S. Loan Market Survey have had a front-row seat to this spectacle, and their concerns are reflected in this year’s survey responses. Those responses reflect the most cautionary outlook seen in the five years FTI Consulting has conducted the survey. Moreover, the views shared were provided prior to the regional banking crisis that began in mid-March.¹ We can only assume that their expressed concerns would be reinforced or amplified by subsequent events in the financial sector over the past month.

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Footnotes:

1: Conor Murray, "What To Know About Silicon Valley Bank's Collapse-The Biggest Bank Failure Since 2008," Forbes (March 13th, 2023) Link