Hedge Funds and PE Firms Eat into Business Lending by Banks

Business lending at banks is up 3.3 percent year on year as of May 9th, improving but far below double digit gains seen in previous years; one of the bigger drivers being the lag is more competition from non bank lenders like PE firms, Hedge funds and insurance companies; “There’s more non-regulated lenders in the market all the time, and I don’t see that trend abating,” Terry Katon, head of capital markets at Regions Financial Corp. , said in an interview with the Wall Street Journal; political uncertainty and a tax law that left companies flush with cash has also led to slowing market. Source.