On October 8, 2009
Lending Rises Among Banks That Raised Government Funds
As the credit markets were seizing up last fall, the Treasury Department established the so-called Capital Purchase Program to stimulate bank lending. Has it worked? About as well as could be expected. In the second quarter, banks that raised money through the program made an aggregate $287 billion in loans per month to individuals and businesses, up from $240 billion per month in the fourth quarter of 2008, according to a new GAO report. That’s not a massive leap, but it’s significant given the tightening in lending standards and that credit usually wanes during economic recessions. In all, the 21 biggest institution participating in the CPP, part of the Troubled Asset Relief Program, have extended a total of some $2.3…
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