Despite a big push by bankers to make more small business loans, the percentage of such loans in bank portfolios declined by about 5 percentage points over the past three years in the Eighth Federal Reserve District.
At the end of second quarter 1996, small business loans—those for $1 million or less—made up about 56 percent of the District's business loans. "This is a healthy chunk of banks' loan portfolios," says Fed economist Michelle Clark Neely, "but not as healthy a chunk as we might have expected." The ratios declined, Neely explained, because overall business lending grew faster than small business lending. "No one is quite sure yet how to explain the trend," she said, "but one possibility is that small business loans have gotten larger over time, and, thus, are no longer counted in the small business loan category."
The decline is not a statistical fluke. Similar trends are apparent when one looks at small commercial loans collateralized by real estate: District loans under $1 million made up 62 percent of the total secured and unsecured commercial loans at the end of June, compared with 67 percent at the end of June1993. The downward trend shows up nationwide as well.
About 50 economists, researchers, educators and policymakers from across the country met at the Federal Reserve Bank of St. Louis Oct. 3 to discuss a range of issues affecting America's rural communities. Presenters at the symposium called, "The Rural Economy: Heading into the 21st Century," spoke on the challenges confronting rural communities, as well as the opportunities they need to take advantage of if they are going to survive—and thrive—in the next century. Among the presenters were :
To receive a copy of "Economic Forces Shaping the Rural Heartland," a Kansas City Fed report, call their Public Affairs Office at (816) 881-6701. To receive a copy of "Agriculture, Technology and the Economy," a Dallas Fed publication, contact their Public Affairs Office at (214) 922-5254.
Homeownership Rates, 1995