Following the retirement of CEO Ken Thompson and mortgage misery it inherited from Golden West Financial, this is a good time to focus on another area of risk for Wachovia(WB Quote) and other large banks: construction and land development loans.
On an aggregate basis, U.S. banks and S&Ls had $630 billion in construction and land development loans as of March 31. Of this total, 4.72% were considered nonperforming, compared to 3.15% in December 2007 and 0.95% in the same period the prior year.
Nonperforming loans include those that are past due 90 days or more. If we include all loans delinquent 30 days or more, 7.19% of construction loans were delinquent as of March 31, up sharply from 4.98% in December 2007 and 2.03% in March 2007.
Many of the 10 U.S. banks with the largest construction portfolios have serious levels of delinquent construction loans: ...
Recent Comments
| Dow Jones | S&P 500 | NASDAQ | 10-Year Note | |
|---|---|---|---|---|
| 10,305.01 | 1,091.81 | 2,139.10 | 32.34 |
Oil *
76.16
|
|
DOWN
159.39
|
DOWN
18.82
|
DOWN
36.95
|
DOWN
0.45
|
10 Yr
3.23%
SPDR Gold
114.74
|
|
-1.52%
|
-1.69%
|
-1.70%
|
-1.37%
|
Data delayed 20 minutes |
Connect with TheStreet