And the Survey Says…

A decade after the biggest financial crisis since the Great Depression, the wheels of lending and commerce have begun to turn again. It was only after central banks in the U.S., European Union and Japan implemented extreme measures that drove down real interest rates to zero (or less) that this happened, leaving them with a completely different problem than what was on their hands a decade ago: what to do with an abundance of capital. As economists and policymakers debate over the fragility of the market and the impact of highly accommodative monetary policies, one thing remains certain: credit markets are overwhelmed with low-cost capital looking for gainful returns.

Mark Laber and John Yozzo wrote nearly a year ago in the American Bankruptcy Institute Journal about the expansion of corporate credit markets and the migration of lending away from traditional banks and towards private capital funds and other investment vehicles. Read on to learn about their recent Loan Market Survey, which fielded opinions from 104 traditional bank lenders and non-bank lenders and asked respondents about a variety of topical questions about the current and expected lending environment.