The trends I’ve just described can be seen (at least in part) as responses to the lessons drawn from the crisis – by households and businesses – regarding the dangers of excessive debt. Another factor is that the funding environment for banks has been more difficult than it was before the crisis, and this has raised the net cost of financial intermediation.
To some extent, these effects might be expected to fade as economic expansion proceeds and confidence in global credit markets improves. Nonetheless, when we think about what the post-crisis environment might look like further ahead, it seems unlikely that we’ll be going back to the days of consistent double-digit growth in lending that we saw in the pre-crisis years.