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Banks are loosening credit, survey says

BY HBSDEALER Staff

Facing competition from smaller competitors, big banks are easing their lending standards, especially for small businesses, according to a survey conducted by the Federal Reserve Board. The quarterly survey, which polled senior loan officers between April and July, found that, on average, large domestic banks have eased terms for firms of all sizes, but especially small businesses, for the first time since 2006. Domestic banks also reported that they had stopped reducing the size of existing credit lines for commercial and industrial firms, on average.

Nearly all of the respondents that reported having eased standards or terms on commercial and industrial loans cited more aggressive competition from other banks or non-bank lenders, such as financial intermediaries or the capital markets. About half of these respondents pointed to a more favorable or less uncertain economic outlook.

Smaller banks are still being cautious about their lending practices, the federal survey found. And the increased availability of capital has not resulted in a rush for financing.

“Most banks reported that demand for business and consumer loans was about unchanged,” the survey said.

A question about mortgage loans showed that only a small fraction, on average, has eased lending standards, and nearly all of them were large banks. Less than one-half of survey respondents indicated that their bank originated nontraditional mortgage loans. Of these respondents, nearly all reported no change in their banks’ standards for extending such loans.

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Lowe’s names Alvarez to board

BY HBSDEALER Staff

Mooresville, N.C.-based Lowe’s has named former McDonald’s chief Raul Alvarez, 55, to its board of directors, increasing its total members from 11 to 12.

The company said Alvarez will serve on the board’s governance and audit committees.

Alvarez served as president and COO of McDonald’s Corp. from 2006 until his retirement in December 2009. Previously, he served as McDonald’s president of the North America and U.S. divisions, as well as president of McDonald’s Mexico. Alvarez previously held several leadership positions at both Wendy’s International and Burger King Corp.

“Raul Alvarez brings over 30 years of retail and consumer marketing experience with some of the world’s best known brands,” said Robert Niblock, chairman and CEO. “His background in these areas, along with his international perspective and strategic planning, is highly valuable to our board.”

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Home Depot Canada eyes flexible formats

BY HBSDEALER Staff

An article in the Montreal Gazette reported that supply chain improvements taking place at The Home Depot Canada will give it the ability to open a variety of medium sized stores.

The paper quoted Annette Verschuren, president of The Home Depot Canada, who said the ability to deliver to multiple store sizes will help boost market share.

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