Moody’s Investors Service recently downgraded Bank of America, Wells Fargo and Citigroup, a move that is expected to have a ripple effect through the commercial real estate industry. Too bad. The shake-up in confidence the downgrades are sure to bring will bring to a halt, or at the very least, curb some recent and long-awaited good news.
In August, the Federal Deposit Insurance Corp. reported a milestone for the commercial banking industry: The number of problem banks fell for the first time in 19 quarters, or since Q3 2006. That wasn’t entirely news.
Trepp, among other research analysts, began calling a bottom or plateau to banking industry woes roughly around the same time. In the first half of 2011, bank failures numbered 48, according to Trepp, a significant drop from either the 86 failures in the same period of 2010 or the second half of that year, when 74 banks failed.
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