Risky Lending by Wall Street Banks Has Increased, Regulators Warn

And that is why the Volcker Rule in Dodd-Frank bill must be enforced!!!

Credit deemed ‘special mention’ or worse said to have risen 13%

WASHINGTON—Risky lending by Wall Street banks has risen sharply despite some improvements in underwriting from years past, warned U.S. regulators on Friday.

Credit deemed “special mention” and worse jumped 13% based on exams for the last 12 months ended in April from the previous 12-month period to $421.4 billion, according to the annual review of bank’s major loan portfolios conducted by the Federal Reserve, Office of the Comptroller of the Currency and Federal Deposit Insurance Corp.

The review said the greatest levels of risk remain in “leveraged loans” that are extended to highly indebted companies, such as those bought by private-equity firms, as well as oil and gas portfolios.

Read on.

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