by Calculated Risk on 5/18/2009 09:12:00 PM
Monday, May 18, 2009
WSJ: Small Banks Face $100 Billion in CRE Losses
From the WSJ: Local Banks Face Big Losses
Commercial real-estate loans could generate losses of $100 billion by the end of next year at more than 900 small and midsize U.S. banks if the economy's woes deepen, according to an analysis by The Wall Street Journal.The WSJ analyzed 940 small and midsized banks, using the Federal Reserve's "more adverse" stress test scenario. The WSJ analysis showed that about two-thirds of the banks, under the "more adverse" scenario, will be below the "level considered comfortable by regulators" without raising additional capital.
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Total losses at those banks could surpass $200 billion over that period ...
The FDIC will be very busy ...
Note: There are about 8,300 FDIC insured institutions. The WSJ analyzed bank holding companies that filed financial reports with the Federal Reserve for the year ended Dec. 31.