U.S. banks are tightening their lending standards, according to an October Federal Reserve survey of 61 domestic banks and 18 U.S. branches of foreign lenders. Small businesses, riskier households and commercial real estate are being hit hardest, while lending to large and middle-market companies remains broadly unchanged. Banks have also tightened standards for loans to private equity funds, business credit intermediaries and jumbo mortgages, while raising premiums on riskier loans. The 10-year Treasury note yield reached 5.349% on Oct. 5, intensifying the repricing of credit risk and higher borrowing costs, according to economist Tiffany Wilding. Nearly 20% of families were behind on loan payments at the end of 2025, compared with about 12% in 2022.
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