WASHINGTON (5/5/10)--The Federal Reserve’s survey of lending practices found that while “most banks kept their lending standards unchanged in the first quarter,” a number of banks “further tightened many terms on loans to businesses and households.” “For almost all loan categories for which the survey indicated a further net tightening of credit standards, the fraction of banks that reported having done so edged down and in a few categories banks eased standards, on net,” the Fed reported. “Modest net fractions” of banks “continued to tighten standards and terms on credit card loans,” the Fed continued. However, the Fed did find that many of the banks that reported easing their lending standards were larger banks, with those banks mainly easing their loan terms for “commercial and industrial loans to large and middle-market firms.” The Credit Union National Association (CUNA) has repeatedly promoted lifting the current cap on credit union member business lending to 25% of a credit union’s assets. According to CUNA estimates, such a lift would result in $10 billion in new capital for small businesses and create as many as 100,000 new jobs at no cost to American taxpayers. While the amount of small business loans would double to a total of 10% if the MBL cap is raised, the banking industry would still dominate the business loan market, with 90% of the total share of loans, CUNA has said. In a recent letter to their colleagues, a number of legislators said that "any future jobs-creation legislation that the House considers" should include MBL legislation. For the Fed release, use the resource link.