Business owners are changing banks at three times normal levels, a trend researchers attribute to their difficulty in obtaining emergency loans. If the forgiveness stage of the Paycheck Protection Program proves arduous, that rate could climb much higher.
Banks and other lenders are said to have poured hundreds of billions of dollars into financing private-equity firms and their investment deals in recent years. Defaults have been low, but an economic slowdown could put these relationships to the test.
It’s hard to time the next economic slowdown. But lenders, many with lingering memories of the financial crisis, are taking steps now to limit exposure in commercial real estate, construction and other loan segments.