Lugar de Noticias Haynes and Boone
John Penn in Fort Worth Business Press: Expect a 2010 Bankruptcy Surge
01/11/2010
The news is full of stories about how lending remains tight. The president invites leading bankers to the White House to encourage more lending. But few expect the free-wheeling days of easy lending to return for quite some time.
The day before the White House meeting with bankers, the head of the Federal Deposit Insurance Corp. warned that this year’s recent record of bank closings might be exceeded in 2010. That is the kind of announcement that makes lenders even more conservative – especially after they just finished prepaying three years worth of FDIC premiums.
It should not come as a surprise that lenders become more conservative in times of economic uncertainty. While the economy is not shrinking the way it was this time last year, it is also not growing the way it was during the recent past. Lenders and borrowers alike are trying to find “the new normal” level of business activity, staffing and inventories. The consensus seems to be that we won’t return to a sustained period of significant growth for quite some time.
This article excerpted from the Fort Worth Business Press. For full text, please click here.