Big Bank Loan Growth to Decline: UBS

NEW YORK (TheStreet)-- Loan growth has been one of the few positives for the banking industry in 2011, but that trend looks like it's about to change, according to an analyst report published Monday.

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Commercial and industrial lending "has been a relative bright spot for loan growth, but we have recently become concerned around the outlook for growth in the category," wrote UBS analyst Brennan Hawken.

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Hawken cited a "recent dramatic downturn in CEO confidence brought on by the extreme levels of political and economic uncertainty on both sides of the Atlantic," a phenomenon he argues risks derailing the brief recovery we have seen in C&I lending."He pointed to a "big drop in demand" in the October survey of loan officers by the Federal Reserve, arguing it is "the beginning of a new trend rather than a one-off blip."Hawken estimates Bank of America's(BAC) 2012 loan growth will fall by 4.4% in 2012 from 2011. He previously had expected a more modest 0.7% drop. He also sees declines of 1.6% and 2.7% at Citigroup (C) and JPMorgan Chase(JPM), respectively.Hawken also fears a weakening consumer in lowering his earnings targets for all three banks. -- .Follow me on twitter.

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