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Results of the Fourth-Quarter Survey | Vol. 10.4 | January 8, 2018

This Senior Loan Officer Survey (SLOS) focused on changes to business-lending practices in the fourth quarter of 2017. The survey was conducted between November 6 and December 1, 2017.

  • Survey results suggest that overall business-lending conditions eased slightly in the fourth quarter (Chart 1),1 primarily because of easier pricing conditions (that is, lower spreads) on lending to corporate borrowers (Chart 2).2 Non-price conditions were mostly unchanged.
  • This marks the first time that lending conditions have eased since the oil price shock of 2014. Price conditions last changed in the second quarter of 2017, with a slight tightening, while non-price conditions have changed little since easing in the fourth quarter of 2016.
  • Competition was the main reason cited by respondents for the easing in lending conditions for corporate borrowers this quarter.
  • Lending conditions for small business borrowers were unchanged.
  • From a regional perspective, both price and non-price conditions eased for commercial borrowers in the Prairies as the economic activity related to the natural resource sector continues to increase.
  • Demand for credit increased in the fourth quarter of 2017, after being unchanged in the third quarter.
  • Access to capital markets improved for all risk grades of corporate borrowers.

Chart 1: Overall business-lending conditions

Chart 2: Price and non-price lending conditions

  1. 1. Note that the balance of opinion suggests only the direction of the net change in lending conditions; it does not provide information on the magnitude of the change.[]
  2. 2. The pricing of credit is defined as spreads over base rates, rather than as the level of rates.[]

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