Tuesday, November 24, 2015

'No loan growth' at Philly banks: report

Lenders may cut rates still further to lure credit-wary business borrowers

'No loan growth' at Philly banks: report


National Penn Bancshares Inc., like its Philadelphia-area rivals, suffers from "no loan growth," writes analyst Frank Schiraldi at Sandler O'Neill + Partners, NY. "As we continue to see from others in the footprint, loan growth was nil in the quarter" ended March 31 and newly reported last week.

Commercial lending was actually up 1.1% since the quarter ended Dec. 31 (core deposits also rose), but the gain "was offset by continued declines in residential mortgages" as many southeastern and central PA homeowners keep paying down their loans as soon as they can afford to, Schiraldi told clients in a report..

Bank managers say "competition is heating up on both structure and pricing," making for a borrower's market, Schiraldi added.

He said Nat Penn won't compete on structure (implying a refusal to go back to the bubble-years practice of reducing down payments, for example).

But Nat Penn bosses said they may have a little "wiggle room" on loan pricing, even with today's low rates, for commercial real estate loans. 


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PhillyDeals posts interviews, drafts and updates that Joseph N. DiStefano writes alongside his Sunday and Monday columns and ongoing articles about Philadelphia-area business.

DiStefano studied economics, history and a little engineering at Penn. He taught writing and research at St. Joe’s. He has written for the Inquirer since 1989, except when he left a few times to work at Bloomberg and elsewhere. He wrote the book Comcasted, and raised six kids with his wife, who is a saint.

Reach Joseph N. at JoeD@phillynews.com, 215.854.5194, @PhillyJoeD. Read his blog posts at http://www.philly.com/PhillyDeals and his Inquirer columns at http://www.philly.com/philly/columnists/joseph-distefano/. Bloomberg posts his items at NH BLG_PHILLYDEAL.

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