Analysis
Community bankers grew less confident for a fourth consecutive quarter, the Conference of State Bank Supervisors reported October 5. Its Community Bank Sentiment Index fell nine points in the third quarter but remained positive overall.
Expectations diverge
The monetary-policy component dropped 26 points to 70, while future business conditions fell 16 points to 83. Both remained below the neutral score of 100. Expectations about regulatory burden stayed positive at 106, despite a seven-point decline. Six of the seven survey components fell.
CSBS economist Tom Siems linked the weaker confidence to inflation, interest rates and economic uncertainty. Nearly half of respondents thought the country was entering a recession or already in one.
The September survey drew responses from 248 community bankers across 38 states and the District of Columbia.
What remains uncertain
These are banker expectations, not a recession determination or measures of actual lending, loan losses or economic growth.