4.23.14: Who Holds the Most Commercial Loans?

The winner is commercial banks, which held $1.57 trillion in commercial real estate debt at year-end 2013, according to data from the Federal Reserve Board. The amount of commercial real estate debt held by banks represents 48.9% of the $3.20 billion of total outstanding loans. CMBS is a distant second, with 17.7% of the commercial loan market, followed by insurance companies (10.7%), other (10.4%), federal agencies (7.6%) and agency CMBS (4.6%). The nation’s largest banks increased their holdings of commercial real estate loans by 4.7% in 2013, the first substantial gain since the downturn. Meanwhile, loans in CMBS rose a meager 0.1% as new originations barely kept pace with CMBS maturities. But the big year-over-year gainer was agency CMBS, with a whopping 29.7% increase in outstanding loans at year-end 2013. The loser for 2013 was federal agencies, primarily Fannie Mae/Freddie Mac and HUD multifamily programs, which saw an 8.3% decline in commercial loans outstanding. Banks are expected to continue growing balances in 2014, as most of the problem loans from the 2008-2009 financial crises have been resolved, and with net interest margins compressing, banks need to grow their commercial loan balances to increase or even maintain earnings. For 2014, $100 billion in CMBS originations are forecasted, which should lead to some modest growth after subtracting maturing CMBS loans and troubled CMBS loans that are resolved and paid off. Federal agency loans will still be pressured by leaders in Washington, D.C. who want to reduce the involved of government in commercial lending. Overall Holders of Commercial Real Estate Debt on December 31, 2014

Total   $, Billions   %
Banks $1,565.9 48.9%
CMBS 567.4 17.7
Insurers 343.4 10.7
Federal agencies 243.5 7.6
Agency CMBS 147.1 4.6
Other 332.3 10.4
TOTAL $3,199.6 100.0%

Source: Federal Reserve Board

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This entry was posted in CMBS, CMBS Conduit Loans, Commercial Mortgage-Backed Securities, Commercial Real Estate Loans, Fannie Mae, Freddie Mac, HUD 221(d)(4), HUD 223(f), Michael D. Sneden, News & Recent Closings, The Banker's Mortgage Conduit, Valuexpress and tagged , , , , . Bookmark the permalink.

One Response to 4.23.14: Who Holds the Most Commercial Loans?

  1. Aron Goldberger says:

    There is a large error in numbers on your website. Your number states banks held $1.57 billion in commercial debt. This number should read $1.57 trillion. Also there is an error in your year your site reads “The loser for 2103 was federal agencies, primarily Fannie Mae/Freddie Mac and HUD multifamily programs, which saw an 8.3% decline in commercial loans outstanding.”

    The year should be 2013.
    Below is the link to your website with the error.
    https://valuexpress.wordpress.com/2014/05/07/4-23-14-who-holds-the-most-commercial-loans/

    Aron Goldberger
    aron.goldberger@yahoo.com

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