SLOOS Net Tightening (Small Firms) - Full History
Gray shaded areas indicate U.S. recessions.
Source: Federal Reserve FRED, Series DRTSCIS. Shaded areas = NBER recession dates. Updated 2026-03-09.
What the SLOOS Is and Why It Matters
The Senior Loan Officer Opinion Survey on Bank Lending Practices -- the SLOOS -- is a quarterly Federal Reserve survey of approximately 80 of the largest domestic banks and 24 large U.S. branches of foreign banks. It asks a deceptively simple question: did you tighten, ease, or leave unchanged your lending standards in the past quarter?
The net percentage -- banks tightening minus banks easing -- is published as FRED series DRTSCIS (small firms) and DRTSCILM (large firms). Positive means net tightening. Negative means net easing. Zero means no change.
Why should a small business owner care about a survey of bank executives? Because this survey tells you what is going to happen to your next loan application 1-2 quarters before it happens. Banks do not change their loan approval criteria overnight. When SLOOS shows tightening, the actual implementation -- higher minimum credit scores, more documentation requirements, lower maximum amounts -- follows within one to two quarters.
Reading the SLOOS Like a Pro
The SLOOS covers four critical dimensions:
- Standards: Are banks tightening or easing approval criteria? (This is the headline number.)
- Terms: Are they changing pricing, collateral requirements, or covenant strictness?
- Demand: Are they seeing more or fewer loan applications?
- Reasons: Why are they tightening -- economic outlook, bank-specific, regulatory, competitive?
The demand and standards readings together tell you whether the credit market is clearing (supply = demand), rationing (tight supply, flat demand), or overheating (easy supply, surging demand).
How to Use the SLOOS for Business Decisions
The SLOOS is a planning tool. Here is how to use it:
If tightening is rising: Apply for credit now, before conditions get worse. Lock in rates and terms while you still can. Build cash reserves for the period ahead.
If tightening is falling (but still positive): Conditions are improving but have not normalized. You may face a slightly easier approval process than last quarter, but do not assume banks are back to normal.
If the reading turns negative (net easing): Banks are competing for borrowers. This is the time to negotiate -- shop your business loan across multiple banks and push for better rates and terms.
The SLOOS as an Early Warning System
When the SLOOS reading crosses above +20% net tightening, the probability of an economic downturn within 4-6 quarters increases significantly. When it crosses above +40%, a recession is almost certain. When it drops below zero, a recovery is typically underway.
The current reading of 8.9% is below the danger zone but has been positive for 15 quarters. Think of it as a low-grade fever that has lasted much too long. Not an emergency, but not healthy either.
Frequently Asked Questions
The Senior Loan Officer Opinion Survey on Bank Lending Practices. The Fed surveys ~80 of the largest banks quarterly about whether they are tightening or easing lending standards. The current reading is 8.9% net tightening for small firms.
When SLOOS shows tightening, the actual implementation (higher credit score minimums, more documentation, lower loan amounts) follows within 1-2 quarters. The survey tells you what banks are deciding now about the loans they will make next quarter.
Above +20% is a yellow flag. Above +40% has historically coincided with recessions. Below zero means banks are competing for business -- the best time to apply for a loan.
Quarterly, typically in February, May, August, and November. The Fed publishes the results about 2 weeks after the survey closes. It is available free on the FRED website.
No. It covers approximately 80 of the largest domestic banks, which account for roughly 60-70% of all bank lending. Smaller community banks and credit unions are not included, though they tend to follow similar patterns.
Federal Reserve FRED database. Key series: DRTSCIS (small firm standards), DRTSCILM (large firm standards), DRSDCIS (small firm demand), DRSDCILM (large firm demand).