WASHINGTON (AP) — A Federal Reserve survey finds more than half of U.S. banks that lend to European banks have tightened their standards, a reflection of the persistent European debt crisis.
Of the 26 U.S. banks surveyed that make loans to European banks, five said they had tightened their standards considerably in the October-December quarter. Another 10 said that they had tightened them somewhat in the same period, the survey found.
Many economists predict that Europe's debt crisis will push the region into a recession this year. Many European banks are heavily exposed to government debt, making the banks more of a risk.
No banks who reported making loans to European banks said they had eased their standards on those loans, although 11 banks said their standards remained basically unchanged.
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