Small Banks Turn Corner on Loan Growth

Community banks are seeing loan growth rise, as businesses seek to expand to meet a surge in consumer spending.

That’s the message from a growing number of community banks reporting third-quarter earnings this month. After a year of sluggishness, more small lenders are reporting solid demand for business and commercial real estate loans. Many also report robust pipelines that suggest steady loan demand into 2022.

If more banks report similar results, it would mark an inflection point at which lenders move past the lackluster demand from the pandemic and into a new era of strength. Banks are flush with deposits — the result of high pandemic-linked savings — and well-equipped to fund loan growth.

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