WASHINGTON, DC-Bank commercial real estate delinquencies are dropping, hurray! Surely that means CMBS delinquency rates—widely reported to be on the rise—can’t be too far behind. Actually they can.

Besides SNL Financial and Chandan Economics, the Mortgage Bankers Association has weighed in with its own statistics showing the drop in delinquencies for most commercial real estate loans in the second quarter. Stats cherry picked from its newly-released Q2 Commercial/Multifamily Delinquency Report include: the 60+ day delinquency rate for multifamily loans held or insured by Fannie Mae decreased 0.08 percentage points to 0.29%. The 90+ day delinquency rate for loans held by FDIC-insured banks and thrifts decreased 0.34 percentage points to 3.11%. Then there was this: the 30+ day delinquency rate for loans held in CMBS increased 0.12 percentage points to 8.97%.

There are several reasons for the discrepancy between bank-loan and CMBS delinquencies, Jamie Woodwell, MBA’s vice president of commercial real estate research, tells GlobeSt.com. Starting with the obvious, the loans made by banks and CMBS lenders are very different. There are also different vintages.

“When the CMBS market was extremely active from 2005 to '07, that was when property prices were at their peaks,” Woodwell says. “So loans made in that period have some different underlying features than loans made over other periods of time.”

Finally, there is a difference in the way banks and CMBS lenders measure delinquencies, Woodwell says. “Both are appropriate for each sector but as a result the delinquency rate for CMBS is capturing different things than the delinquency rates in banks and thrifts,” he says. “A good half of all CMBS loans that are included in the delinquency figures are in foreclosure or REO.  Because of charge-offs and other ways banks account for delinquent loans, the calculation of the delinquency rate for banks generally would not include these.”

So, sadly, it doesn’t follow that because delinquency rates are improving among banks that they will improve for CMBS as well. What is true, however, is that the overall economic tide is lifting all the proverbial boats in the industry now. “The economy is gradually improving, and that's always a net positive for CRE,” Woodwell says.