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Then Bernanke criticized banks again, implicitly, by saying that they had restricted lending too much, making it hard for ordinary Americans to get a mortgage.
The Royal Bank of Scotland, which is 81% owned by the British taxpayer, has restricted lending to Russian companies across the board, while Dutch bank ING is also looking to reduce its Russian loan book.
As troubles on Wall Street have spread, banks have restricted lending.
Business secretary Vince Cable has talked on several occasions about how the elimination of risk means restricted lending, at least in the short term.
Banks and investors have severely restricted lending to each other because their capacity to do so has been limited by losses that they have suffered and because they are fearful they may not be paid back.
The state, of which Hyderabad is the capital, severely restricted lending after politicians criticized SKS and other microlenders of being too aggressive in collecting repayments from impoverished families and driving some borrowers to suicide — a contention that lenders strongly deny.
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As long as banks restrict lending while they strive to mend overstretched balance-sheets the economy will continue to wilt.
He said the bill to increase the speed of credit card reforms and pending legislation to crack down on interchange fees could further restrict lending.
Troubling for more traditional regional banks a layer or two down from the very biggest U.S. banks are rules that may force them to raise capital and, bankers argue, restrict lending.
The Bank of England hit back shortly afterwards insisting that it any plans to restrict lending would not be accepted.
He suggested the bill would force banks to further restrict lending and absorb huge losses as the economy worsens.
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