WASHINGTON – Federal regulators say risk remains heavy in large loans made by banks and other financial institutions, though lending standards have improved.
The Federal Reserve and other agencies cite increasing risks in loans to oil and gas producers as oil prices have fallen.
The steep decline in oil prices has hurt many energy companies. The amount of large oil and gas loans that are at risk of failing or already in default doubled in the first quarter from the same period in 2015, according to the agencies’ review released Friday. Those loans jumped to $77 billion from $38.2 billion.
Overall, the review found that loans at risk of failing or already in default, plus those showing potential weakness, remained high at 10.3 percent of the total $4.1 trillion in large loans.
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