Consumers and businesses are starting to borrow more after hunkering down since the Great Recession, fueling a pickup in economic growth.
Bank loans and leases grew at a 7.7% annual rate in the second quarter, the sharpest increase since 2008, according to Federal Reserve data and SNL Financial.
The surge was largely driven by business loans, which rose 12.6% at an annual rate. Consumer loans rose at a solid 6% pace, up from 3.8% in the year-ago period.
Although commercial and industrial loans have picked up for years, "it's working its way down to (small) and middle-market companies," says banking analyst
Similarly, consumers were taking out more auto and student loans, but they've stepped up the volume recently and are making more credit card purchases after cutting back substantially after the downturn.
The momentum was reflected in banks' second-quarter earnings.
In recent years, small businesses hesitated to boost capital spending, in part because of concerns about the Affordable Care Act and budget battles in
But concerns about the health care law are fading, and
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