There are two things that banks look at when deciding to make a loan. They're looking at the cost of funds and they're looking at the risk to the borrower. Both of those elements are being affected by your view of risk. Investors are risk averse now: when they lend money to a bank, they want a high rate for it. When banks lend money, they tend to be more risk averse, too, because we're in a recession and they have to worry about getting paid back when they make the loan.
On March 10th, 2009. See this statement in context.