Few bank risk managers expect credit standards will be relaxed this year, and nearly half see room for further tightening, according to a quarterly survey conducted for FICO by the Professional Risk Managers’ International Association (PRMIA).

The survey showed bankers aren’t as pessimistic as they were during the first quarter, but suggested that consumer credit will fall short of demand for the rest of the year.

Andrew Jennings, chief research officer at FICO, noted that government data released in August showed personal bankruptcies at their highest levels in five years, and that other data demonstrates "ongoing challenges" in housing and employment.

"This type of economic environment makes it difficult for lenders to open up the flow of credit without taking on significant risk," Jennings said in a press release.

A majority of the 235 bank risk officers surveyed in July — 53 percent — expected mortgage delinquencies to increase, down from 60 percent during the second quarter. About a third of those surveyed said they expected mortgage delinquencies would remain the same, and 14 percent expected a decrease.

Less than 4 percent of bank risk officers who are responsible for auto loans and credit cards expected delinquencies on auto loans to fall this year, but 15 percent expected improvement in credit card delinquencies.

More than 1.5 million individuals and families filed for bankruptcy in the year ending June 30, a 21 percent increase in one year, according to the latest numbers from the Administrative Office of the U.S. Courts.

Statistics show non-bankruptcy filings have more than doubled from 727,167 recorded in the year ending June 30, 2007, to their highest level since new laws that raised the bar for filing bankruptcy took effect.

Bankruptcy filings stay on a borrower’s credit report for seven to 10 years, and usually have a serious impact on FICO scores, because they typically invovle defaults on multiple loans, such as a mortgage, auto loan and credit cards.

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