The Board of Governors of the Federal Reserve publishes an informal review of economic conditions nine times per year. The Beige Book (so called because of its beige hard copy cover) is an interesting and quick read for observing trends that various bankers and businesspersons have reported to the Federal Reserve. Each district reports separately, and most of Spilman’s physical footprint falls within the Fifth District (Richmond Fed). Most of Pennsylvania falls into the Third District (Philadelphia Fed), while Pittsburgh and the northern panhandle of West Virginia is within the Fourth District (Cleveland Fed).
For this review period, some of the highlights include:
- According to a Virginia lender, mortgage interest rates rose recently, while consumer credit standards were unchanged. A Virginia bank executive reported that underwriting exceptions were more prevalent, especially in nonrecourse lending. In commercial lending, applications for large business expansion loans have increased.
- A North Carolina banker noted a pick-up in capital investments, particularly for construction projects.
- Employers continued to express concern about potential cost increases related to the Affordable Care Act. Average wages rose moderately at manufacturing establishments, but declined at services firms, according to our latest survey.
- A West Virginia cabinet manufacturer remarked that steady growth in new construction boosted sales for his firm’s higher-end cabinets.
- A custom plastics executive in North Carolina reported stronger new orders. In North Carolina, textile and composites manufacturers broke ground for new plants.
- In Virginia, a resort manager remarked on the good skiing weather this season, having already sold several times the number of passes as last year at this time.
Of course, the reported economic observations can be far different than what your particular financial institution is experiencing. Nonetheless, this resource can be helpful for taking the pulse on what various players in the region are reporting, and we recommend bookmarking the website for occasional review.
If you have any questions, please contact Spilman or other knowledgeable counsel.