Loan Squeeze Gets Tighter (from the San Diego Business Journal)

That retreat has slowed lending and investment of second-tier players such as private equity funds, hedge funds and asset-based finance companies, all of which depend on larger institutions for their funding, says Charlene Davidson, an investment banker with McGladrey Capital in Costa Mesa.

"Over the last six months, I’ve been seeing lots of private equity funds walk away from deals because the banks have pulled their financing," Davidson said. Things have gotten so bad that banks are reluctant to lend to each other, she says.