The Federal Reserve Bank of
Firms reported an overall positive outlook for the first half of 2014. More than half of respondents expected revenues to increase and 30 percent expected to add employees, compared to 19 percent that reported adding employees in 2013. Twenty-nine percent of firms (similar to first half of 2013) plan to apply for credit in the first half of 2014 and 18 percent are considering applying.
Despite the positive signs, small businesses also reported high credit search costs and a more challenging credit market for firms seeking
* The top reason firms sought credit was to manage day-to-day operation expenses; applicants continue to rely on real estate collateral, especially personal real estate, to secure debt.
* More than one in four firms applied for expansion capital, up from previous surveys.
* Most applicants reported needing small amounts of capital (
* Sixty percent of firms carried debt; majority of firms hold
* Profitable firms were not only more successful in applying for credit but were also more likely to experience positive interest rate changes on existing debt.
TNS 30BautistaJude 140215-4638899 30BautistaJude
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