Trepp, a leading provider of information, analytics, and solutions to the structured finance, commercial real estate (CRE), and banking markets has released its quarterly report of bank portfolio loan performance in commercial real estate, multifamily, and construction. The third quarter 2019 results show that overall delinquencies are low and debt yield is steady.
NEW YORK, Jan. 24, 2020 /PRNewswire-PRWeb/ -- Trepp, a leading provider of information, analytics, and solutions to the structured finance, commercial real estate (CRE), and banking markets has released its quarterly report of bank portfolio loan performance in commercial real estate, multifamily, and construction. The third quarter 2019 results show that overall delinquencies are low and debt yield is steady.
The Trepp bank loan performance benchmark report is derived from the Trepp Anonymized Loan Level Repository (T-ALLR) and provides risk rating, delinquency rates, and other metrics for $168B in outstanding loan balances.
Debt yield on new origination CRE loans is currently in the 10.5% range and has been steady for the past five quarters, after dropping from its peak of 12% in 2014. Multifamily debt yield is holding steady at 8.25% in the most recent quarters. In early 2013, it was nearly 10%.
Overall delinquency rates are low, with the recent number as of Q3 2019 reading .04%, falling from last quarter's rate of .11%. In Q2 2019, Trepp noted that construction loan delinquencies were .19%, which have since fallen to .05% in Q3. Construction loans account for 20% of all T-ALLR loans.
"Bank loans showing a low delinquency rate reflects the stability of the CRE market," according to Russell Hughes, vice president who manages Trepp's data consortia initiatives. "Though many are searching for signs of a recession, the delinquency data, often an early sign of stress in the market does not indicate any issues at this point," Hughes said.
Income-producing CRE is the largest segment with $85B in active loans and a 90+ delinquency rate of 0.06%. Multifamily loans, which represent nearly a third of the loan population, had a 90+ delinquency rate of 0.04%.
The T-ALLR Quarterly Benchmark Report analyzes loan performance across a number of data points including delinquency, CRE property type distribution, average loan size, interest rate spread, balance-by county, maturity year, and origination quarter and year. The report, which is generated from Trepp's managed bank loan data consortium, captures CRE and commercial and industrial (C&I) data from participating commercial banks. The T-ALLR data is anonymized and aggregated to provide insights into trends and pockets of risk while protecting the security of the consortia participants.
Trepp, founded in 1979, is the leading provider of information, analytics, and technology to the CMBS, commercial real estate and banking markets. Trepp provides primary and secondary market participants with the web-based tools and insight they need to increase their operational efficiencies, information transparency, and investment performance. From its offices in New York, San Francisco, and London, Trepp serves its clients with products and services to support trading, research, risk management, surveillance, and portfolio management. Trepp is wholly-owned by Daily Mail and General Trust (DMGT). For more information, visit http://www.Trepp.com
SOURCE Trepp, LLC