Phoenix Management, a part of J.S. Held "Lending Climate in America" first quarter survey results.
JERICHO, N.Y., March 28, 2024 /PRNewswire-PRWeb/ -- Global consulting firm J.S. Held, proudly celebrating 50 transformative years, reveals the "Lending Climate in America" survey results from Phoenix Management, a part of J.S. Held. The first quarter survey results highlight concern about the outcome of the upcoming Presidential election and increased uncertainty surrounding the retail and construction industries.
Phoenix's Q1 2024 "Lending Climate in America" survey asked lenders which macroeconomic headwind they were most concerned about heading into 2024. A majority of lenders (55%) are most concerned about the 2024 election and other political uncertainties. Of the remaining 45% of responses, 27% believe other policy risks (e.g. interest rates) are most concerning while the other 28% are keeping their eyes on the geopolitical climate and war risk. To see the full results of Phoenix's "Lending Climate in America" Survey, please visit https://www.phoenixmanagement.com/lending-survey/
Debtwire recently released a report indicating that bankruptcy filings increased 58% in 2023. When lenders were asked if they believed this trend would continue, a large majority (73%) agreed, also noting that this is a possible precursor to a recession. The remaining 27% of respondents believe that bankruptcy filings will not increase in 2024 and the U.S. will avoid a recession.
Almost 75% of respondents identified both the retail and construction industries as likely to experience the most volatility in the next six months.
Additionally, Phoenix's "Lending Climate in America" survey asked lenders how they see overall demand for loans changing. Of the lenders surveyed, 46% of lenders believe there will be no change in the demand for loans, while 18% believe there will be a decrease. The remaining respondents (36%) believe that there will be an increase in the demand for loans. This is cemented by 64% of surveyed lenders believing there will be an interest rate decrease in the upcoming six months (the other 36% believe the Fed will make no change to interest rates in the next six months).
Lender optimism in the U.S. economy increased slightly in the near term from 1.75 in Q4 2023 to 1.91. 73% of lenders believe the economy will perform at a "C" level during the next six months while 18% believe the economy will perform at a "D" level. More telling, lender expectations for the U.S. economy's performance in the longer term increased significantly from 2.08 to 2.55. Of the lenders surveyed, 64% believe the U.S. economy will perform at a "B" level during the next twelve months, an increase of 39 percentage points from the prior quarter.
"Lenders are concerned with the economic impact of the upcoming presidential election, and an overwhelming majority believe that bankruptcy filings will increase in 2024," says Michael Jacoby, Senior Managing Director of Phoenix Management, a part of J.S. Held. "Furthermore, borrowers' expectations regarding expansion, hiring, and acquisition plans have been tamped down since the Q4 survey. The results seem to fly in the face of increases in both the short-term and long-term expectations of the economic performance of the U.S. economy. Still, it supports the notion that different pockets of the economy and industry sectors are performing differently." The survey reveals the overwhelming majority of lenders identified retail and construction as industries likely to experience the most volatility in the upcoming six months. Jacoby continues, "this certainly dovetails with what we are seeing in our client base. We expect continued volatility and choppiness in borrower performance and lender outlook until the Fed begins reducing rates and the outcome of the 2024 presidential election is decided."
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About Phoenix Management, a part of J.S. Held
For over 35 years, Phoenix has provided smarter, operationally focused solutions for middle market companies in transition.
Phoenix Management Services® provides turnaround, crisis and interim management, and specialized advisory for both distressed and growth-oriented companies. Phoenix Investor Services® provides quality of earnings, operational diligence, Quality of Enterprise®, business integration, sell-side business preparation, and other transaction related support. Phoenix IB® provides seamless investment banking solutions including M&A advisory, complex restructurings, and capital placements.
As a part of J.S. Held, Phoenix works alongside more than 1,500 professionals globally and assists clients – corporations, insurers, law firms, governments, and institutional investors.
J.S. Held is a global consulting firm providing technical, scientific, financial, and strategic expertise across all assets and value at risk. Our professionals serve as trusted advisors to organizations facing high-stakes matters demanding urgent attention, staunch integrity, proven experience, clear-cut analysis, and an understanding of both tangible and intangible assets. The firm provides a comprehensive suite of services, products, and data that enable clients to navigate complex, contentious, and often catastrophic situations.
More than 1,500 professionals serve organizations across six continents, including 81% of the Global 200 Law Firms, 70% of the Forbes Top 20 Insurance Companies (85% of the NAIC Top 50 Property & Casualty Insurers), and 65% of the Fortune 100 Companies.
J.S. Held, its affiliates and subsidiaries are not certified public accounting firm(s) and do not provide audit, attest, or any other public accounting services. J.S. Held, its affiliates and subsidiaries are not law firms and do not provide legal advice. Securities offered through PM Securities, LLC, d/b/a Phoenix IB, a part of J.S. Held, member FINRA/ SIPC or Ocean Tomo Investment Group, LLC, a part of J.S. Held, member FINRA/ SIPC. All rights reserved.
Media Contact
Kristi L. Stathis, J.S. Held, +1 786 833 4864, [email protected], JSHeld.com
SOURCE J.S. Held
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