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Dampened Demand for Bank Loans Reflects Supply Bottlenecks, Not a Weakness in the Recovery

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Abstract

Throughout the pandemic, banks have experienced weak business loan demand. Although banks expect demand to grow as the worst of the pandemic wanes and the economy recovers, loan demand may remain weak in some industries due to persistent supply chain bottlenecks.

Suggested Citation

  • Jacob Dice & Padma Sharma, 2022. "Dampened Demand for Bank Loans Reflects Supply Bottlenecks, Not a Weakness in the Recovery," Economic Bulletin, Federal Reserve Bank of Kansas City, issue April 22,, pages 1-4, April.
    • Handle: RePEc:fip:fedkeb:94104
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    File URL: https://www.kansascityfed.org/Economic%20Bulletin/documents/8772/EconomicBulletin22SharmaDice0422.pdf
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    References listed on IDEAS

    as
    1. Berger, Allen N & Udell, Gregory F, 1995. "Relationship Lending and Lines of Credit in Small Firm Finance," The Journal of Business, University of Chicago Press, vol. 68(3), pages 351-381, July.
    2. Viral V Acharya & Sascha Steffen, 2020. "The Risk of Being a Fallen Angel and the Corporate Dash for Cash in the Midst of COVID," The Review of Corporate Finance Studies, Society for Financial Studies, vol. 9(3), pages 430-471.
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    More about this item

    Keywords

    Bank loans; Pandemic; Banks and banking;
    All these keywords.

    JEL classification:

    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages

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