Nonbanks are originating more commercial mortgages on fixer-uppers in response to a sharp drop in the cost of funding in the securitization market. These deals are said to be "vastly different" than other CRE instruments that sustained big losses in the crisis — so far.
Banking regulatory agencies Thursday announced that they would raise the aggregate loan commitment threshold for syndicated loans to be included in the Shared National Credit program from $20 million to $100 million.
It’s not clear whether syndicated credit agreements require 100% investor consent before adopting a new benchmark. The industry trade group suggests giving new loans the flexibility to change indexes without unanimous approval, but investor advocates are balking.
So-called transitional lending has traditionally been kept on balance sheet; but it’s become attractive to bundle the loans for transactions called (take a deep breath) commercial real estate collateralized loan obligations. Can investors stomach the features these deals sported before the crisis?