"Commercial borrowers who are using real estate as collateral may feel an increasingly cold shoulder from lenders they approach," says E. Talbott Briddell, president of Phoenix, in a statement. "A significant portion of lenders across the nation believes the value of real estate is inflated right now. If this market begins to cool or even burst, borrowers up and own the food chain will feel the effects."
The lenders surveyed predict that the overall economy will perform at what Briddell describes as a "C-" level for the first six months of 2003, before rising, he says, "to a C/C+ level during the second half of the year."
While more than half of the lenders believe a US invasion of Iraq would have a negative effect on the economy, only one in five believes invading Iraq would send the economy back into recession.
Phoenix positions itself as a "turnaround firm" and it serves companies that are in financial, operational or managerial difficulties. It conducts a quarterly survey to gauge shifts in lenders' attitudes toward the economy.
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