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Nov 14 -- The Board of Governors of the Federal Reserve System (Board) invites comment on a proposal to extend for three years, without revision, the Senior Loan Officer Opinion Survey on Bank Lending Practices (FR 2018; OMB No. 7100–0058). Comments must be submitted on or before January 16, 2024.

A senior loan officer at each respondent bank completes this voluntary survey through an electronic submission up to six times a year. Senior staff at the Reserve Banks with knowledge of bank lending practices serve as the main contacts for the survey respondents in their district and help administer the survey. The current reporting panel consists of up to 80 large domestically chartered commercial banks and up to 24 large U.S. branches and agencies of foreign banks. The purpose of the survey is to provide qualitative and limited quantitative information on credit availability and demand, as well as on evolving developments and lending practices in the U.S. loan markets. A portion of each survey typically covers special topics of timely interest.

Although the Board has the authority to conduct the survey up to six times a year, the survey has typically been conducted only four times a year since 1992. Consistent with the FR 2023, other types of respondents, such as other depository institutions, bank holding companies, or other financial entities, may be surveyed, if appropriate. The respondents’ answers provide information that is critical to the Federal Reserve System’s monitoring of bank lending practices and credit markets. The Federal Reserve relies on the regular opportunity to solicit information from banks within the framework of the survey. Aggregated survey results from 1997 to present are available to the public on the Board’s website.

The information obtained from the survey provides valuable insights on credit market and banking developments and is helpful in the formulation of monetary policy. Information from the survey is reported regularly to the Board and to the Federal Open Market Committee (FOMC) as an official memorandum to FOMC participants and in other internal briefing materials. This information has been particularly valuable in the recent period as it has provided the Federal Reserve with insight into the potential effects of deposit outflows and funding pressures in the banking sector on the availability of credit to households and businesses. The survey has also attracted considerable attention from the business and financial press and is used in academic research on banking and macroeconomic activity.6 Aggregate survey responses have been used to study the effects of the more stringent international capital requirements commonly referred to as Basel III. The results are also included in the Board’s reports to Congress on Availability of Credit to Small Businesses, which are produced every five years pursuant to section 2227 of the Economic Growth and Regulatory Paperwork Reduction Act of 1996. The survey results have also been useful in enabling the Federal Reserve to keep abreast of complex banking developments that have evolved over time, and analysis based on the survey results often appears in Federal Reserve publications as the Monetary Policy Report, which is submitted to Congress semiannually, and the Financial Stability Report.

In the last several years, the survey has provided critical information on a number of important banking topics. Recent special questions have addressed issues in rapidly changing credit markets, banks’ lending terms and outlook for commercial real estate lending standards and demand, banks’ assessments of the levels of their lending standards relative to longer-term norms, and banks’ expectations about changes in asset quality and credit standards over the coming year. Regarding lending to households, the survey has provided valuable information on timely topics, including the asset quality of consumer loans in areas most affected by falling energy prices and the likelihood of approving credit card applications by borrowers’ credit score. In addition, the survey helped shed light on broader issues, such as the relationship between banks’ lending policies and movements in the yield curve for Treasury securities, and the factors that influenced banks’ and borrowers’ participation in the Main Street Lending Program.

The questions on the FR 2018 survey are generally qualitative. They are drafted with the intent to elicit useful information without imposing undue reporting burden. To understand certain banking practices, however, the Federal Reserve occasionally needs to ask quantitative questions. The Federal Reserve has sought to limit the difficulty and quantitative content of survey questions, insofar as an adequate understanding of the subject matter allows. When quantitative information is requested, respondents generally are asked to provide approximate or rough estimates, usually in terms of percentages rather than dollar amounts. A respondent may decline to answer a particular question when answering would entail excessive burden. Experience has shown that only a small number of respondents decline to answer any particular question. Response rates overall have been high and resulted in adequate and informative answers.

For a number of years, the survey has included approximately 25 questions designed to measure changes in credit standards and terms on bank loans and perceived changes in the demand for bank credit. The survey has also normally included a number of special questions about developments in banking practices. The Federal Reserve distributes two versions of the survey, one to domestically chartered institutions and one to U.S. branches and agencies of foreign banks. The survey tailored to the branches and agencies of foreign banks contains fewer questions. Specifically, it omits both the recurring and the special questions on residential mortgage and consumer lending because the branches and agencies typically make few, if any, loans to households.  

The FR 2018 survey also includes an ad hoc portion to conduct special surveys from a selection of respondents, should the need arise to collect additional information on bank lending conditions and practices.

Frequency: Quarterly.

Respondents: Domestically chartered commercial banks and U.S. branches and agencies of foreign banks. Other types of respondents (such as other depository institutions, bank holding companies, or other financial entities) may also be surveyed if appropriate.

Total estimated number of respondents: 104.

Senior Loan Officer Opinion Survey on Bank Lending Practices: https://www.federalreserve.gov/data/sloos.htm
Supporting statement: https://www.federalreserve.gov/reportforms/formsreview/FR%202018%20OMB%20SS%202023.pdf
Data collection instruments: https://www.reginfo.gov/public/do/PRAICList?ref_nbr=202105-7100-009
FRN: https://www.federalregister.gov/d/2023-25092

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