SFA Research Corner: Banks Pull Back on Credit Card Loans for Some Borrowers as Demand Grows
Provided by Structured Finance Association
The FED’s November 7 release of the Senior Loan Officer Opinion Survey on Bank Lending Practices (SLOOS) showed that demand for credit card loans has become stronger even as banks tighten access to credit for borrowers with lower credit scores. While market volatility and inflationary concerns have pushed credit spreads wider, investor demand for credit card ABS has held steady due, in part, to the asset class’s strong performance. So far in 2022, issuance surpassing $27 billion (compared to $18 billion in 2021) is driven by maturing bonds and new receivables stemming from continued robust loan demand, factors that we expect will continue to drive issuance in coming years.