Nonperforming commercial real estate (CRE) loans dominated the portfolios of banks that were shut down last month, according to the February U.S. Bank Failure Report, issued by Trepp LLC.
According to Trepp, CRE loans constituted $230 million – 72% – of the total $320 million in nonperforming loans reported among last month's failed banks. Construction loans made up 37% of the total, at $119 million, and commercial mortgages made up 35% of the total, at $111 million. In comparison, residential real estate loans made up $65 million in nonperforming loans, or 20% of the total nonperforming balance.
Trepp expects the total figure for bank failures this year to be ‘north of 100’ and that the cycle of bank failures will continue at least into 2012.
SOURCE: Trepp LLC
