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Analysis

CRE Lending Could Get Even Tighter If Fitch Downgrades Banks

It also suggests that the banking sector might not be as safe as federal regulators have been claiming.

The U.S. commercial real estate industry’s ability to get credit and, therefore, fortunes have strong ties to the 4,648 insured banks (according to the FDIC) in the country that provide about 38.6% of CRE loans. Anything that negatively affects the stability and credit ratings of the banks is an issue for the CRE industry.

Despite multiple federal officials and regulators repeatedly saying that the entire banking system is sound, Moody’s recently cut ratings on a number of smaller and regional banks and put some larger ones on notice that they might face potential actions.

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Erik Sherman

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