Smaller Banks' Commercial Real Estate Loans Heighten Risks, Though Prices Rebounding
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Smaller "community" banks have greater exposure to commercial real estate loans than big banks, making them more vulnerable.
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New York Community Bancorp's recent losses and need for emergency funding highlight banks' commercial real estate risks.
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As of Q3 2022, Bank OZK, Home BancShares, Pacific Premier Bancorp, International Bancshares Corp., and New York Community Bancorp had the highest commercial real estate loan concentrations.
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Beaten-down commercial real estate prices are starting to rebound after peaking in early 2022, lessening risks.
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Some Wall Street firms like Goldman Sachs Asset Management see opportunities to invest in U.S. property now.