Interview with a Banker – Why Banks Still Aren’t Lending

[Corey Dutton]

With the exception of community banks and credit unions, most would agree that banks still aren’t lending. “Hogwash!” some of you bankers who are reading this will probably say.

As a follow up to a post I did nearly 2 years ago, I did an interview with a commercial banker regarding new policies and procedures for lending in today's climate. Because most banks are still trying rid their balance sheets of residential and commercial properties, bankers are STILL cherry picking the loans they will do. And, even the most qualified borrowers are being turned away or are required to bring in PITI reserves for 6-12 months on new purchases!

How long until banks soften their grip on their cash? Will bank lending loosen up in 2012?

Please share your thoughts on this.