KBRA Releases Research - U.S. Community and Regional Bank Loan Portfolio Evolution and Performance: Historical Perspective and Context

29 Aug 2023   |   New York


KBRA releases a research report that reviews the evolution and performance of loan portfolios for a peer group of U.S. community and regional banks since 2002, which encompasses the effects of the global financial crisis (GFC) as well as the last cyclical recession in 2001. The report details the shifts in the loan portfolio composition over this time, as well as provides a historical perspective on loan quality, notably the level of annual realized loan losses and the degree of structural earnings protection to absorb those losses. We also include a special analytical section on multifamily lending, an area of significant portfolio growth during the past several years.

The report concludes with a stylized scenario analysis that evaluates the ability of the banks within the peer group to cover loan losses should they rise to the peak level of the 2001 downturn, and should earnings performance continue to weaken as a result of further net interest margin pressure.

Click here to view the report.

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