Banking Sector Getting Healthier but Still Dealing with Non-Performing Notes and OREO via NREI Readers Write

The U.S. banking industry has recovered steadily from its doldrums during the Great Recession; however, many lending institutions are still faced with a significant amount of troubled real-estate loans.

That was the view of a panel of experts on a recent episode of the “Commercial Real Estate Show” radio program. Guests provided an enlightening look at the banking sector and outlined a wide array of strategies and valuable tips for banks and other lenders faced with problem loans.

Numbers Improving

As of September 2012, 91 percent of U.S. banks were profitable, according to Christopher Marinac, managing principal and director of research for FIG Partners. “[Still], if you go back seven years, the industry was making 14 to 15 percent returns on equity. That no longer is the case. We’re closer to 8 or 9 percent, as a general rule.”

Furthermore, 51 banks failed in 2012, a notable decline from the preceding years, Marinac added. He predicted that number to drop to approximately 30 this year.

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