Recommendations by top banking regulators that lenders strengthen underwriting standards for leveraged loans may decrease funding to the neediest borrowers, according to Loan Syndications and Trading Association.

The Federal Reserve and the Office of the Comptroller of the Currency sent letters to some of the biggest U.S. banks asking them to avoid arranging debt that may be classified by regulators as having some deficiency that may result in a loss, according to nine people with knowledge of the communication.
Fed Loan Warning
The head of the Federal Reserve, Janet Yellen, warns of the consequences of its own policy: increase the risks in the banking sector.