A new report from the Mortgage Bankers Association (MBA) shows that commercial mortgages performed better than other types of loans over the course of 2010 for banks and thrifts. MBA estimates that commercial mortgages, which total $1.1 trillion, or 15% of banks’ overall loan holdings, finished the year with lower delinquency rates than other types of loans such as single-family mortgages and construction loans. And over a four-year period, the sector has accounted for less than 5% of charge-offs among banks and thrifts.
At the end of 2010, the 30+ day delinquency rate for commercial mortgages reached 5.33% compared with the 6.48% rate for all loans. (The report also looks at multifamily mortgages, commercial and industrial loans, construction loans, credit card debt and loans to individuals).
Moreover, the figure declined more than 30 basis points from 5.64% at the end of 2009. Construction loans, on the other hand, had the highest 30+ day delinquency rate of any loan type, at 17.98%.