Even Solid Firms Feel Pinch as Lending Remains Tight

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BY MATTHIAS RIEKER

When health-care management firm Caduceus Inc. asked for larger credit line, it was surprised when its bank said no. Caduceus isn't "on the ropes," said James Bonomo, vice president of the New York company. "We need this increase for expansion."

The company's request and demurral from J.P. Morgan Chase & Co. illustrate the recessionary standoff between lenders and borrowers. Bankers lend, but ever more carefully, frustrating businesses that want to expand.

Bankers have sought to defend themselves as an angry public demands more credit. Data from Moody's Economy.com show that, in aggregate, loans by commercial banks so far in this ...

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