Thomson Reuters/PayNet Small Business Lending Index registered
132.4 in December, up from a downwardly revised November reading
of 127.3 but below the December 2014 reading of 134.1. Lending
had risen sharply earlier in the year.
"What started as a full gallop in 2015 is barely trotting along
now," said Bill Phelan, President of PayNet. "We are barely
replacing worn-out assets here."
Dropping oil prices and slowing world growth are taking a toll
on U.S. economic growth, which slowed to a 0.7 percent annual
pace in the last quarter of 2015.
Small business borrowing is a key barometer of growth because it
is the little firms that tend to do much of the hiring that
fuels economic growth.
Lending slowed sharply to small businesses in mining and
agriculture, as well as in wholesale trade, transportation and
construction, the figures showed. Texas was particularly hard
The PayNet index typically corresponds to U.S. gross domestic
product growth a quarter or two ahead, with Monday's figures
spelling further slowing but probably not recession in the first
part of this year, Phelan said.
The delinquency rate on loans more than 30 days past due ticked
down in December to match a record low of 1.44 percent, separate
data from PayNet showed.
Small businesses "are settling in for a long time in waiting for
what they view as a difficult situation to come to an end,"
Phelan said. "I don't think it's time to break the glass and
pull the alarm yet, because financial health got better."
PayNet collects real-time loan information such as originations
and delinquencies from more than 325 leading U.S. lenders.
(Reporting by Ann Saphir; Editing by James Dalgleish)
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