In its latest attempt to thaw the country's credit freeze, the ""U.S. Department of the Treasury"":http://www.treasury.gov, ""Federal Reserve"":http://www.federalreserve.gov, and ""Federal Deposit Insurance Corporation"":http://www.fdic.gov (FDIC) issued a joint statement yesterday urging banks to start lending again.
""The ongoing financial and economic stress has highlighted the crucial role that prudent bank lending practices play in promoting the nation's economic welfare,"" the agencies said. ""The recent policy actions are designed to help support responsible lending activities of banking organizations, enhance their ability to fund such lending, and enable banking organizations to better meet the credit needs of households and business.""
The statement calls on banks to step up and ensure that the needs of credit-worthy borrowers are met and to continue raising capital to support the nation's financial system. It also calls on financial institutions to take on aggressive loss mitigation and foreclosure prevention strategies and said banks should reassess their incentive and compensation policies.
To read the full statement issued by the three regulators, ""click here"":http://www.fdic.gov/news/news/press/2008/pr08115.html.