US and European banks are not lending despite huge bailout funds injections

[Peter Sumter, Banking News Contributor]

Huffpost Business: It seems that entrepreneurs and others looking for loans from US and western European banks are likely to continue to be disappointed as despite the enormous amounts of bailout funds injected into the banking sector, figures over the past few quarters for some of the largest banks show that the banks are simply not lending.

Analysts are reporting that banks appear to be making their profits these days from their ‘rainy day’ funds (funds for bad loans) as well as from generating more in fee income for services.  There is concern that if this trend continues, then the financial crisis is sure to mature into a full-scale world-wide economic crisis as businesses will not be able to grow which will impact heavily upon consumer spending.

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