Why Your Bank Wants No Part of Your Business

Post-Recession Banking Reforms Are Throttling Small Independent Companies

Capital is cheap almost everywhere except for in the heart of the American economy—independent U.S. companies with less than $100 million in revenues.

This is the downside of regulations, enacted after the Great Recession, that made banks safer than ever. Unfortunately, those same regulations also caused banks to focus on mortgages and publicly traded loans, rather than lending to growing private companies. This dislocation may explain why the economic recovery since 2007 has been the most tepid in the past 50 years.

Middle market companies in the U.S., defined as companies …