The FDIC Has A $30 Billion Junk Loan Problem

In its capacity as receiver for failed banks, the FDIC is responsible for either selling or winding down the operations of failed banks.  In the vast majority of cases, the FDIC is able to sell a failed bank to a purchaser who agrees to purchase some or all of the assets of the failed institution. […]

FDIC’s Bair Says Real Estate Crucial To Entire Economy – $3.5 Trillion In Mortgages At Risk Of Default

October 13, 2010 – Can the economy improve without a recovery in real estate values?  This question was addressed today by FDIC Chairman Sheila Bair, in a speech to the Urban Land Institute in Washington, D.C.   Despite optimistic forecasts by various analysts, Ms. Bair cited the daunting challenges that must be overcome in order to […]

Record High Delinquency Rates On Commercial Loans Stress Banks

June 24, 2010 – Commercial and multifamily delinquencies continued to increase in the first quarter of 2010 according to a report by the Mortgage Bankers Association. According to Jamie Woodwell, MBA’s Vice President of Commercial Real Estate Research, “Weakness in the economy has continued to weigh on commercial properties, which in turn weighs on the […]

Commercial Real Estate – The Most Widely Advertised Crash In History

Is Armageddon Upon Us? Predictions of Armageddon for the commercial real estate market are being urgently issued daily by prognosticators of doom.  Many analysts are breathlessly predicting that collapsed real estate prices ensure a mountain of defaulting commercial real estate loans that will lead to the failure of thousands of small and regional banks.   […]

Regulators Attempt To Solve Commercial Loan Crisis With “Extend and Pretend” Guidelines

“Huge Crash” In Commercial Real Estate Predicted The potential for massive losses on commercial bank loans has been an open secret for some time now.  Both industry experts and regulatory agencies are concerned that a wave of defaults on commercial loans could result in billions of losses for an already weakened banking system.   The latest […]

7 Reasons Not To Have Confidence In The Banking System

Does the recent strong rally in the shares of bank stocks imply that the banking crisis is over, or are we looking at a mirage?  Here are 7 reasons why the banking crisis may only be in the early stages of an ongoing crisis which could ultimately result in a lack of public confidence in […]

Banks Turn Blind Eye To Commerical Real Estate Losses

The attitude of banks towards the collapse of commercial real estate seems to be ” ignore it and it will go away”.   Sometimes this strategy works, sometimes it doesn’t. Right now, this “see no problem” attitude is beginning to raise eyebrows as  losses on commercial real estate loans expand while corresponding loss reserves decline.  Consider […]