A new review by the Federal Deposit Insurance Corporation indicated that the credit quality of large loan commitments owned by U.S. banking organizations, foreign banking organizations (FBOs), and nonbanks improved in 2011 for the second consecutive year.

The 2011 Shared National Credits (SNC) Review revealed that the total analyzed loans declined more than 28 percent to $321 billion in 2011, although the percentage of criticized assets remained high compared to pre-financial crisis levels. Loans rated as doubtful or loss — the two weakest categories—fell 50 percent to $24 billion in 2011, reported F&I and Showroom magazine.

The review cited operating performance among borrowers, debt restructurings, bankruptcy resolutions, and ongoing access to bond and equity markets as reasons for the improvement. Industries leading the improvement in credit quality were finance and insurance, real estate, construction, media and telecommunications.

Despite the improvements, the SNC noted that poorly underwritten loans originated in 2006 and 2007 continued to negatively affect the SNC portfolio, as nearly 60 percent of criticized assets were originated in these years. Refinancing risk remained elevated as nearly $2 trillion, or 78 percent of the SNC portfolio, matures by the end of 2014, according to the SNC. Of this maturing amount, $204 billion was criticized.

Despite nonbank entities owning the smallest share of loan commitments, they owned the largest share of classified credits at 58 percent.

The Federal Reserve Board (FRB) announced June 20 that auto dealers are temporarily not required to comply with certain data collection requirements in the Dodd-Frank Act. Initially, Dodd-Frank amended the Equal Credit Opportunity Act (ECOA) to require creditors to collect and report information from credit applications made by women- or minority-owned businesses as well as small businesses.

The proposed rule falls under the ECOA, also known as Regulation B, and will allow dealers to remain exempt until the final regulations are issued, reported F&I and Showroom.

Although the Consumer Financial Protection Bureau (CFPB) will have the authority to issue rules to implement this provision of the ECOA, the FRB still maintains the authority to issue rules for certain motor vehicle dealers, the statement continued.

Creditors are not obligated to comply with the data collection requirements until the CFPB issues detailed rules to implement the law, so the FRB issued a proposed rule to clarify that its approach also applies to motor vehicle dealers that are subject to the board’s jurisdiction. Comments from the public on the proposed rule are open until July 29.

AutoNation chief Mike Jackson has joined the board of directors of the Federal Reserve Bank of Atlanta’s Miami branch.

Jackson, CEO of the nation’s largest automotive retailer since 1999, was appointed a director of the Miami branch by the Federal Reserve Board of Governors in Washington, D.C., one of three directors appointed by that body. His term runs through the end of 2013, reported Automotive News.

The appointment means auto retailing will have a bigger influence on monetary policy in the Southeast.

Branch directors for the Federal Reserve Bank of Atlanta share economic information relative to their industries and territories of operation with the district bank’s president and head directors. The feedback is used to make monetary policy decisions and discount rate recommendations.

Borrowing among U.S. consumers fell for the fourth straight month in May, dipping by 4.5 percent, according to the Federal Reserve.

The biggest decline was seen in the revolving credit category, which mainly consists of credit card debt. From April to May, the category fell at an annual rate of 10.5 percent. Since March, the category has dropped by $15.7 billion.

Borrowing in the nonrevolving credit category, composed mostly of auto loans, fell for the second month in a row in May, this time at an annual rate of 1.4 percent, or $1.8 billion. Since March, nonrevolving credit has fallen by $18.3 billion.

Interest rates on new-vehicle loans remained stable at 4.13 percent in May, but are still below the first quarter average of 4.31 percent.

Loan terms mirrored the first quarter average, increasing slightly from 62.6 months in April to 62.9 months in May.

The loan-to-value ratio on new-car loans reached 87 percent in May, a slight decrease from the 88 percent recorded in April and below the first quarter average of 89 percent.

Amount financed increased to $27,886 in May, up $89 from the $27,797 recorded in April. The increase snaps the four-month decline in this segment, but is still below the first-quarter average of $28,444.

Consumer credit increased at an annual rate of 0.5 percent in April, according to the Federal Reserve’s monthly report.

Non-revolving credit, which includes auto loans, rose at an annual rate of 7.1 percent in April. Revolving credit continued its month to month decline and fell at an annual rate of 12 percent.

Interest rates on new-vehicle loans continued to drop and reached 4.13 percent in April, down from 4.28 percent in March, but still higher than 3.94 percent in January.

Loan terms remained stable month to month at 62.8 months in April. This was slightly above the 62.5 months recorded in February and down from the 63.5 months posted in January.

The loan-to-value ratio on new-car loans remained steady month to month at 88 percent in April, but was down from 89 percent in February and 90 percent in January.

Amount financed also fell for the fourth-consecutive month to $27,797 in April, down from $27,912 in March. The amount financed in April was $243 less than the $28,040 recorded in February, and $1,582 less than the $29,379 posted in January.

Consumer credit dropped 8.5 percent in November 2009, the lowest figure of the year, according to the Federal Reserve’s monthly report.

The interest rate on 48-month new-car loans originated at commercial banks was 6.55 percent, down slightly from the 6.61 percent average recorded in the third quarter 2009. The interest rate on new-car loans originated at auto finance companies increased slightly from 3.42 percent in October 2009 to 3.73 in November 2009.

Loan terms dropped slightly from 64.4 months in October to 63.4 months in November. The loan-to-value ratio on new-car loans dipped to 91 percent in November, a return to its September level, but down from 93 percent in October.

The amount financed fell from $32,223 in October to $30,506 in November, a difference of $1,717.