Bank Industry Trends will Change the Lending Business in 2010-2011 says Plunkett Research
Houston, TX. November 9, 2009–A new market research and competitive analysis report by Plunkett Research, Ltd. has identified major trends reshaping the banking, credit and lending industry.
Greatly increased regulatory oversight will restrict lenders.
An era of much lower risk-taking by traditional lenders has begun, and risk capital remains difficult to obtain.
The creation of higher-risk loans and investments will be taken over to a large extent by hedge funds and private equity.
Intense debate will continue about the creation of regulatory authorities that could oversee banking, lending and investment companies from a high level.
Alternative sources will be used to a growing degree by small businesses and consumers unable to get loans elsewhere. Peer-to-peer lending is growing, enabling lending between members of lending clubs, or friends and family. “Angel investors,” wealthy individuals who make investments in small firms, are filling the capital needs of small companies and startups.
A lengthy and expensive process of write-downs by lenders will continue into 2010 and 2011, particularly in credit card and commercial real estate loans.
Consumers are shying away from debt, paying down balances, shopping less and using credit cards less. This is part of what will be a long term consumer trend towards increased savings, lower consumption and lower debt.
A complete industry trends and statistics analysis is provided in Plunkett’s Banking, Mortgages & Credit Industry Almanac, 2010 edition.
According to Jack W. Plunkett, CEO of Plunkett Research, Ltd., “Consumers’ budgets are tight, and they are cutting down on discretionary spending of all types. Americans have radically shifted their perspective away from excessive borrowing and towards savings. Meanwhile, business lending has taken a big turn toward reduced risk.”
A complimentary Introduction to the Banking Industry can be viewed at Plunkett’s website. “We believe that the banking industry will continue to restructure and seek ways to reduce costs. Further bank closings are in store,” Plunkett said.
About Plunkett Research, Ltd.
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