Most lenders across the nation don't believe the federal Troubled Asset Relief Program will have a significant impact on lending, according to the latest quarterly Lending Climate in America survey conducted by Phoenix Management Services, a Chadds Ford-Pa.-based consulting firm.

Only 3 percent of lenders surveyed said they believe TARP will have a "meaningful" impact on their lending practices. Meanwhile, 55 percent of respondents said they expected the program to have a "modest impact" on lending, and 36 percent said they believe it will have "minimal impact," while the remaining 6 percent believe it will have "no impact" on lending.

In other survey findings, lenders' expectations for the economy significantly deteriorated from the previous quarter. Lenders said they expect data to show that the economy performed at a low "D" level during the last quarter. The long-term outlook fell to a "D" expectation level as well—the lowest level in the history of the quarterly survey.

An overwhelming majority—91 percent—cited the reduction in consumer purchasing power as the economic issue borrowers and prospective customers are most concerned with in the near term. Six percent of lenders identified increasing commodity prices and 3 percent cited volatile exchange rates as the most concerning economic issue. Respondents didn't select higher labor rates or the impact of importing lower-cost goods as key concerns in the near-term economic environment.

"While lenders are near unanimous in the near-term outlook, they also believe that the bottoming out of the housing market will signal a fundamental change in the macroeconomic outlook," says Michael Jacoby, Phoenix Management's managing director.

Eighty-three percent of respondents believe the bottoming out of the residential housing market will be the most important factor that will assist the U.S. in recovering from this economic downturn. When asked to identify the two most important factors, 31 percent of lenders selected the flow of credit to long-term mortgages and 27 percent chose the Obama administration and other factors.

Forty-four percent of lenders predict inflation will trend lower over the next six months, up sharply from 18 percent in the previous survey.

The percentage of lenders with customers having no growth expectations over the next six to 12 months continued to rise significantly from recent quarters, to 78 percent—the highest level recorded in this survey in eight years. Twenty-two percent of lenders said their customers had moderate growth expectations, down from 49 percent in the previous quarter.

The percentage of lenders anticipating that interest rates will fall over the next six months rose to 73 percent, compared with 23 percent in the previous survey. Twenty-two percent of lenders said they believe rates will remain unchanged, while 5 percent believe interest rates will rise over the next six months.

The percentage of lenders expecting to tighten their loan structures increased to 65 percent, up from 47 percent in the previous survey. As a result, the percentage of respondents planning to maintain their loan structures fell to 35 percent

Phoenix Management conducts the survey to gauge shifts in lenders' attitudes toward the economy. The survey includes lenders from commercial banks, commercial finance companies, and factors across the nation. Phoenix has been conducting the survey for more than 13 years.

Phoenix Management says it offers "turnaround, crisis and interim-management, and strategic advisory services to middle-market companies in transition." Along with its headquarters south of Philadelphia, it has offices in New York, Boston, Cleveland, Atlanta, Fort Lauderdale, and Washington, D.C.