Tuesday, November 18, 2008

Fed: Delinquency Rates Rise in Q3

by Bill McBride on 11/18/2008 03:34:00 PM

The Federal Reserve reports that delinquency rates rose in Q3 in almost all categories. The one exception was consumer credit cards (declined slightly), although charge-offs for credit cards rose in Q3.

Commercial Bank Delinquency Rates Click on graph for larger image in new window.

This graph shows the delinquency rates at the commercial banks for residential real estate and commercial real estate.

Commercial real estate delinquencies are rising rapidly, and are at the highest rate since Q3 '94 (as delinquency rates declined following the S&L crisis).

Residential real estate delinquencies are at the highest level since the Fed started tracking the data (since Q1 '91).

Although there is credit deterioration everywhere, the rise in CRE delinquencies is especially significant. The Fed defines commercial as "construction and land development loans, loans secured by multifamily residences, and loans secured by nonfarm, nonresidential real estate", and many of the problems are probably in the C&D loans.