Commercial real estate lending

The Buffalo, New York-based bank said its commercial real estate portfolio continued to shrink, but this was more than offset by business and consumer lending.

There is a tendency to assume that banks carrying a large commercial real estate loan portfolio need to diversify. But that ignores the fact that many of those institutions have much deeper knowledge of the market than their critics.

The regional bank has already seen a large reduction in "criticized" loans, and it expects that trend to pick up as lower borrowing costs alleviate the pain in the commercial real estate sector.

The stock prices of banks that have large exposure to commercial real estate loans surged after comments from Federal Reserve Chair Jerome Powell. His remarks could be a sign that relief is coming on both sides of those banks' balance sheets.

First Foundation in Dallas recently got a $228 million capital injection led by Fortress Investment Group. Now it's announced plans to pivot away from its heavy focus on multifamily loans, which lost value as interest rates rose.

Bank OZK is the latest commercial real estate-heavy bank to announce plans to diversify its business. CEO George Gleason emphasized that he's confident in the bank's loan portfolio, but said he thinks misperceptions are dragging down the stock price.

Some banks with large commercial real estate concentrations are seeing their stock values take a roller-coaster ride as investors discount their assurances about the wobbly asset class.

The bank took a big hit on an office property in Washington, D.C., during the first quarter. This month, it filed a shelf registration statement for an offering of up to $150 million that could be used to bolster capital or refinance debt.

OakNorth Bank in London is eager to utilize the data it's collected from providing risk management software to American banks over the past five years. Its growth plans include eventually acquiring a charter here and making commercial real estate loans.