Construction and development loans are down $411.5 billion since the end of 2007, or 65.4%. Back between the 1988 and 1992 crisis, C&D Loans declined 54.7%, and thus the "Great Credit Crunch" has exceeded that percentage. This is the loan category where community banks remain reluctant to lend and it remains a drag on the homebuilders, who want to rebuild inventories.
As the graph below from the FDIC shows, the noncurrent rate on C&D loans peaked in early 2009, but remains significantly elevated. This indicates that continued write-offs are necessary and implies that the FDIC will continue the bank failure process to whittle down their List of Problem Banks from the current total of 732 FDIC-insured financial institutions.
The above table shows data from the FDIC and www.ValuEngine.com covering 29 community banks that have overexposures to real estate loans. This is just a sampling.
for a larger version of the bank chart.
Reading the Table
: The assets shown in FDIC data.
(SNV - Get Report)
is the largest in the table with $26.04 billion in assets.
: The dollar amount of the exposure. SNV has the largest size exposure at $2.7 billion.
: The percent exposure vs. risk-based capital. Banc Trust Financial has the highest risk at 154% of risk-based capital vs. the 100.0% regulatory guidelines.
: The percent exposure vs. risk-based capital. Pacific Premier Banc has the highest risk at 585% of risk-based capital vs. the 400.0% regulatory guidelines.
: The percentage of CRE loans outstanding versus loan commitments. At 100% all commitments are fully funded which is a negative sign as a healthy pipeline is around 60%.
(VCBI - Get Report)
have their CRE loan commitments fully funded.
: The stocks with a red number are undervalued by this percentage. Those with a black number are overvalued by that percentage according to ValuEngine.
: A "1-Engine rating" is a Strong Sell, a "2-Engine rating" is a Sell, a "3-Engine rating" is a Hold, a "4-Engine rating" is a Buy and a "5-Engine rating" is a Strong Buy.