Residential Mortgages (1- to 4-Family Homes): These are mortgage loans on the books of the banks. Since the end of 2007 this asset class is down $355.4 billion, or 15.8% to $1.89 trillion. Nonfarm/Nonresidential Real Estate Loans: This category is a portion of what's known as commercial real estate loans (CRE). This category has not suffered the fate of other real estate loan categories with a rise of 9.3% since the end of 2007 to $1.06 trillion. Construction and Development Loans: This category has been the Achilles Heel of the banking system. These are loans to developers and home builders where a significant number of loans became noncurrent. With write-downs and asset sales this category is down 66.5% since the end of 2007, but remains elevated at $210.4 billion. Compare this to the crunch of the S&L crisis. At the end of 1988 C&D loans stood at $216.6 billion. At the end of 1992 C&D loans were down 54.7% to $98.1 billion. Home Equity Loans: The problem in this category is the exposure where the bank holding the line of credit does not hold the first lien mortgage. Home equity loans are down 6.6% since the end of 2007 to $567.3 billion. In recent quarters the decline in this category of loans has been accelerating; 5.3% year over year in Q4 2011, 0.4% year over year in Q1 2012, 5.7% in Q2 2012, and 6.7% in Q3 2012. Other Real Estate Owned (OREO) : This asset class has been declining since peaking at $53.2 billion in the third quarter of 2010. This is still a source of stress in the banking system because at $41.0 billion it is up 238.0% since the end of 2007. Notional Amount of Derivative Contracts: Is also a source of continued stress in the banking system. At $229.3 trillion it's up by $63.2 trillion or 38.0% since the end of 2007. Since the end of 2007 the banking system should have de-leveraged, but has not. I still say that time bombs are ticking in this category. Deposit Insurance Fund (DIF): While the FDIC has been making progress on replenishing the DIF, it's is only funded at 0.35% of insured deposits. By September 2020 this percentage must rise to 1.35%.