In fairness, the quality of commercial finance paper was degraded by the Pandemic and is likely still degraded. why banks are ordering their troops back to the office. Yet by now it has sorted itself out and surplus space has recycled.
A n AAA commercial property is as good as the best government bond. It is also thirty year paper. Recall thirty years ago was 1995. A lot of water flows under that bridge and urban change improves areas. The ocean of expanding appraisal values floats even turkeys.
And all major commercial buildings are built to easily last a century and realistically today for several centuries. We are really that good.
Large Bank's Total Exposure to Commercial Real Estate (Updated with 2025-Q3 Data)
CEO, Krahenbuhl Global Consulting LLC
https://www.linkedin.com/pulse/large-banks-total-exposure-commercial-real-estate-updated-rebel-cole-ba2fe/
December 2, 2025
Large Banks with CRE Exposures > 300% of Total Equity Capital
Many astute commentators about the banking industry have been warning about future losses on commercial mortgages as about $1 trillion originated prior to the 2022-2023 run-up in rates mature during the next 12 months and must be refinanced at much higher rates.
I have calculated the total CRE exposure (CRE nonfarm-nonresidential and multifamily mortgages, CRE construction loans, CRE loans not secured by real estate, and unused CRE commitments) as a percentage of total equity to serve as a broad measure of bank exposure to commercial real estate. A variation of this ratio is used by banking regulators to assess CRE exposures; any ratio over 300% is viewed as excessive exposure to CRE. Data are as of Sep. 30, 2025 (Q3).
Below is a list of the total CRE exposure of the 52 banks with greater than $10B in assets where their exposure exceeds 300% of total equity capital. (52 out of 154 large banks, out of 4,435 banks of any size.) Twenty have exposures greater than 400% and four have exposures greater than 500%.
Most prominent (by asset size) are #6 Flagstar Bank, #25 Valley National Bank, #26 Zion Bancorp, #29 Synovus Bank, #33 Columbia Bank (formerly Umpqua Bank), #44 Comerica Bank, #48 East West Bank, and #49 Old National Bank--each of which has more than $50B in total assets.
Flagstar has $92B in assets, $7.9B in CRE mortgages, $30.7B multifamily, $1.6B in CRE construction loans, and $0.7B in unused CRE commitments, for a total CRE exposure of $41.4B, but has only $8.6B in total equity. Total CRE exposure is 481%of total equity (down from 499% of total equity as of Q2).
Zion has $89B in assets, $16.6B in CRE mortgages, $3.0B in multifamily, $2.2B in CRE construction loans, and $3.5B in unused CRE commitments, for a total CRE exposure of $25.8B, but has only $6.9B in total equity. Total CRE exposure is 376% of total equity. Down from 389% in Q2.
East West Bank has $79B in assets, $15.8B in CRE mortgages, $4.4B multifamily, $0.7B in CRE construction loans, and $1.6B in unused CRE commitments, for a total CRE exposure of $21.2B, but has only $6.6B in total equity. Total CRE exposure is 308% of total equity. Down from 317% in Q2.
Comerica has $77B in assets, $11.6B in CRE mortgages, $3.2B multifamily, $2.9B in CRE construction loans, and $3.4B in unused CRE commitments, for a total CRE exposure of $21.2B, but has only $6.6B in total equity. Total CRE exposure is 309% of total equity. Down from 312% in Q2.
Old National Bank has $71B in assets, $13.7B in CRE mortgages, $5.9B in multifamily, $2.6B in CRE construction loans, and $2.4B in unused CRE commitments, for a total CRE exposure of $24.6B, but has only $8.1B in total equity. Total CRE exposure is 318% of total equity. Up from 312% in Q2.
Columbia Bank (formerly Umpqua) has $67B in assets, $14.9B in CRE mortgages, $10.6B in multifamily, $2.2B in CRE construction loans, and $1.0B in unused CRE commitments, for a total CRE exposure of $30.4B, but has only $8.1B in total equity. Total CRE exposure is 358% of total equity. Down from 359% in Q2.
Valley NB has $63B in assets, $17.8B in CRE mortgages, $8.4B in multifamily, $2.2B in CRE construction loans, and $1.5B in unused CRE commitments, for a total CRE exposure of $29.9B, but has only $8.1B in total equity. Total CRE exposure is 377% of total equity. Up from 373% in Q2.
Synovus has $60B in assets, $14.0B in CRE mortgages, $3.8B in multifamily, $1.7B in CRE construction loans, and $1.8B in unused CRE commitments, for a total CRE exposure of $21.4B, but has only $5.8B in total equity. Total CRE exposure is 371% of total equity. Down from 381% in Q2.
SouthState Bank ($66B in assets) saw its exposure fall below 300% to only 297%. It has $21.1B in CRE mortgages, $2.8B in multifamily, $2.0B in CRE construction loans, and $2.5B in unused CRE commitments, for a total CRE exposure of $28.5B, but has only $9.6B in total equity. Total CRE exposure was 302% in Q2
Among banks of any size:
- 1,607 have total CRE exposures greater than 300%, down from 1,697 in Q2 and 1,713 in Q1.
- 866 have exposures greater than 400%, down from 958 in Q2 and 988 in Q1.
- 368 have exposures greater than 500%, down from 426 in Q2 and 449 in Q1.
- 120 have exposures greater than 600%, down from 178 in Q2 and 281 in Q1.
For comparison, the aggregate industry total CRE exposure is 134% of total equity ($3.48 trillion vs. $2.59 trillion). Down from 135% as of Q2 2025.
These statistics are based upon my calculations using publicly available Call Report data downloaded from the FFIEC's Central Data Repository as of Nov. 15, 2025.
Most of these lists will be available for download at FAU's Banking Initiative Website: https://lnkd.in/eA8hsQuu
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