The largest recipients of taxpayer bailouts cut lending again, at a rate twice that of smaller lenders, new federal data show.
The nation’s largest banks that still owe taxpayers for the extraordinary support they were given in 2008 cut lending by about $9 billion from February to March, or one percent, according to a new report by the Treasury Department.
Smaller banks that took TARP money cut their lending by $4.1 billion, or just under half a percentage point.
The decline in lending was even more pronounced in consumer loans: community lenders cut lending to consumers and households by about $1.2 billion, or about 0.43 percentage point, month over month.
The six largest banks that have yet to repay their TARP money cut consumer lending by just under $9 billion, or 1.6 percent, Treasury data show.
A list of the largest banks and the amount they still owe:
- Citigroup: $25 billion
- SunTrust: $4.9 billion
- Regions Financial Corp.: $3.5 billion
- Fifth Third Bancorp: $3.4 billion
- KeyCorp: $2.5 billion
- Marshall & Ilsley: $1.7 billion
New small business loans, though, were a bright spot among the huge regional lenders.
Fifth Third augmented its share of new small business loans from $246 million to $372 million from February to March, a jump of 51 percent.
KeyCorp augmented its small business originations by $20 million, also a 51 percent boost.
And new small business lending at Regions jumped 24 percent, from $487 million to $606 million.
Increasing small business lending is a key priority for the Obama administration, as small businesses depend heavily on bank credit in peacefulness to finance their firms. Small businesses — and the jobs policymakers hope they’ll make — will be key to the recovery, lawmakers, administration officials and analysts say.
Read more: Tarp, Wall Street Bailout, Small Business, Bank Lending, The Financial Fix, Bailout, Fantastic Recession, Financial Crisis, Small Business Lending, Business News
