Figure 10. Changes in demand and supply conditions at selected banks for commercial real estate loans, 1996-2008.
Data are plotted as curves. There are two panels. In the top panel, the net percentage of banks reporting stronger demand begins in 1996 at about negative 2 percent, then, on balance, it rises to about 48 percent by mid-1998, falls to about negative 50 percent by the end of 2001, rises to about 25 percent by mid-2004, and stays at about that level through late 2005. It then falls to about 4 percent by early 2006 and to negative 47 percent by the last quarter of 2007. The net percentage of banks reporting stronger demand rebounds in the first part of 2008 to negative 30 percent, but declines again to end the year at negative 55 percent. In the bottom panel, the net percentage of banks reporting tighter standards begins in 1996 at around 13 percent, dropping to about negative 10 percent by late 1997, spiking to about 46 percent at the end of 1998, and falling to about 5 percent in mid-1999. It rises fairly steadily to about 45 percent in early 2001, remaining at about that level through early 2002, declining steadily to a low of negative 25 percent in early 2005, moving within a range of 25 to 35 percent through mid-2007, and rising to about 50 percent in the third quarter of 2007. For the next several quarters, the series fluctuates between 79 and 87 percent before ending 2008 at 80 percent.
NOTE: The note and source are the same as for figure 7, which states that the data are drawn from a survey generally conducted four times per year; the last observation is from the January 2009 survey, which covers 2008:Q4. Net percentage is the percentage of banks reporting an increase in demand or a tightening of standards less, in each case, the percentage reporting the opposite. The definition for firm size suggested for, and generally used by, survey respondents is that large and middle-market firms have annual sales of $50 million or more.
SOURCE: Federal Reserve Board, Senior Loan Officer Opinion Survey on Bank Lending Practices.
