Trepp: Nonperforming Commercial Real Estate Loans Drove October Bank Failures

Trepp: Nonperforming Commercial Real Estate Loans Drove October Bank Failures Commercial real estate (CRE) exposure was the main driver behind problem loans for the banks that failed in October, according to new data released by Trepp LLC.

CRE loans comprised $401 million (65.1%) of the total $617 million in nonperforming loans at the failed banks. Construction and land loans made up $254 million (41.2%) of the total, while commercial mortgages comprised $147 million (23.9%) of the total nonperforming pool.

Trepp adds that the residential real estate loan category was a secondary source of distress, with $136 million in nonperforming loans, or 22% of the total nonperforming balance. The remainder was comprised of commercial and industrial loans ($69 million, 11.2% of the total) and consumer and other loans ($11 million, 1.7% of the total).

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