A recent survey of bank risk managers has found an upbeat reversal in previously gloomy assessments of the outlook for consumer loan originations and repayments.
The survey of 263 risk managers at U.S. banks was conducted in February 2012 by the Professional Risk Managers' International Association for the FICO credit scoring company.
FICO Chief Analytics Officer Andrew Jennings said in a statement that bankers were "allowing themselves to feel some optimism," due in part to stronger employment.
"These results are consistent with the general sentiment that delinquencies will be less of a problem over the next six months," Jennings said.
Specifically, only 35 percent of respondents expected mortgage delinquencies to rise during the next six months, 32 percent expected higher credit card delinquencies, 28 percent expected higher small-business loan delinquencies, and 20 percent expected more car loan delinquencies. All of those figures were significantly lower than the prior quarter's assessments.
The sore spot was student lending, as 51 percent of the respondents expected student loan delinquencies to rise during the next six months. That was a big drop compared with the prior quarter, but still the second-highest level recorded since the survey was started in early 2010.
Despite that heightened optimism, however, Jennings added that banks are "not out of the woods."
"Foreclosures continue to put pressure on home prices, and jobs are coming back slowly," he said. "But we seem to be headed in the right direction. If we can avoid major bumps in the road, such as a spillover effect from the eurozone crisis, we should continue to see delinquencies drop."
Respondents also expected an adequate supply of most types of loans to meet consumers' demands. Seventy-seven percent of the bank risk managers expected an adequate supply of car loans, 71 percent expected an adequate supply of credit cards, 58 percent expected an adequate supply of student loans, and 52 percent expected an adequate supply of small business loans.
The sore spot here was mortgage loans, as 56 percent of respondents expected the supply of such financing wouldn't meet the demand.
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