AGING DEMOGRAPHICS IMPACT BANK LENDING
The Bank of International Settlements (BIS) investigated the effects of demographic change on bank lending standards and financial stability. BIS found that population aging leads to an increase in banks’ available funds due to older adults’ higher propensity to save in the form of deposits, and an ageing-induced decrease in demand for credit; thereby potentially encouraging banks to reach for yield. Banks more exposed to aging counties in the U.S. relax their lending standards as they grant new loans