The chart above shows weekly commercial and industrial loan volume at both: a) all US commercial banks (blue line, data here), and b) large domestically-chartered commercial banks (red line, data here). A few highlights:
1. Commercial loan volume at large US banks in the first week of January of $831 billion has brought commercial lending to just slightly below the previous peak of $843 billion during the Great Recession in October 2008. Surprisingly, the commercial loan volume for large banks completely recovered from the effects of the 2007-2009 recession in 220 weeks, while it took more than nine months longer (258 weeks) for commercial lending to completely recover from the effects of the 2001 recession when commercial lending at the end of 2005 finally matched the peak level in early 2001.
2. For all US banks, commercial lending during the first week of January was $1.526 trillion, the highest level of business loans in almost four years, going back to March 2009. Compared to the peak loan volume of $1.612 trillion in October 2008, business lending in early January was still about 5% lower, but commercial loan volume should surpass the previous peak sometime during the first quarter of this year, given the current pace of business loan growth. Just like the shorter recovery period for large banks, business loans at all US banks should completely recover all of the lost business from the 2007-2009 recession in 230 weeks, which will be about 40 weeks (and 10 months) shorter than the 270 months of recovery time following the 2001 recession.
Bottom Line: Business lending at US commercial banks is gradually improving, and the volume of commercial and industrial loans at all banks has almost completely recovered from the recessionary effects of the 2007-2009 recession. As much as we hear about the Great Recession being the worst economic downturn since the Great Depression, the time for commercial lending to recover from this last recession is actually 9-10 months shorter than the recovery time following the 2001 recession.