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Strategies & Market Trends : Mish's Global Economic Trend Analysis

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From: John McCarthy	1/11/2009 10:31:47 PM
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Commercial Mortgages: The $400 Billion Ticking Time Bomb Note:This article has a lot of graphs in it so I will just post the link. seekingalpha.com <SNIP> If the low end prevails then the banks are facing $44 billion of additional write-offs, and if the CMBS market is correct then losses soar to $447.9 billion. Recall that banks received $250 billion + to fill the hole caused by the residential mortgage market, and the 90+-day delinquency rate on sub-prime mortgages is running about 30%. According to the FDIC, 18% or $2.1 trillion of the $11.4 trillion residential mortgage loans outstanding are held by commercial banks. The commercial real estate market is smaller, but the banks hold a larger portion. The CMSA reports that 43% or $1.49 trillion of the $3.4 trillion commercial mortgage market is held by banks.

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