By Jonathan Schwarzberg and Lynn Adler
NEW YORK, Sept 11 (Reuters) - U.S. regulators are scrutinizing the impact of falling energy prices on bank loans in a move that could make it more difficult for lenders to extend extra credit to troubled oil and gas companies, sources familiar with the review said.
A halving of the price of oil since the summer has cut the value of assets used by energy companies as collateral for their bank loans, raising the possibility these loans will be classified as troubled in an annual regulatory review set to be published in the autumn.
Officials from the Office of the Comptroller of the Currency (OCC), which supervises national banks, met with lenders last week to discuss the impact of falling commodity prices on outstanding loans as part of the review, sources said.
If the OCC decides certain loans need to be marked as troubled, banks will have to set aside more capital to cover the higher risk of default, making it less profitable for them to lend more to indebted energy firms.
Turning off the credit tap to such firms could push some of them into bankruptcy.
"This is going to put an unexpected regulatory pressure on a traditional source of capital," a source at one lender told Reuters. He declined to be named because the review is confidential.
The OCC examines bank portfolios for compliance with guidelines on leveraged loans that limit how much debt a company can take on.
JP Morgan and Wells Fargo were among the banks that met the OCC last week, one source said.
JP Morgan and Wells Fargo declined to comment.
"We've heard from our lender clients that they are getting relatively consistent grilling from the regulators, especially the OCC, on these questions," a lawyer who advises banks said.
The lawyer said if banks try to refinance or restructure existing loans to ease the burden on an indebted energy firm then the regulator could demand they set aside more capital, making it less profitable for them.
"The difficult choice that the lenders face is to force the borrower into bankruptcy or do something medium term, which unfortunately puts them in regulatory cross-hairs."
A spokesman for the OCC declined to comment about the review but said individual credit decisions were matters for the banks.
"The OCC does not make individual credit decisions for national banks and federal savings associations," he said.
"Early identification of troubled loans and mitigation of associated risk is fundamental to the safe and sound operation of national banks and federal savings associations. The OCC encourages banks and thrifts to work with customers to meet their credit needs."