Community bankers are looking longingly at construction loans' relatively generous returns. What they're not seeing are the higher risk-weightings that may soon go along with such assets.

The Basel Committee on Banking Supervision is currently entertaining tougher capital rules for certain types of construction and commercial real estate loans. If the rules go through, they could ice small banks' plans for returning to profit growth, says Jonathan Hightower, a banking lawyer at Bryan Cave.

Subscribe Now

Access to authoritative analysis and perspective and our data-driven report series.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.