The recent stimulus law’s relief for renters and extension of the federal eviction ban were meant to ward off a housing crisis. But owners of 1- to 4-unit dwellings still face mounting mortgage and property tax debts, and delinquencies could start rising soon — followed by foreclosures.
Bank and credit union groups are pushing to include the industry’s front-line workers in the next priority group, but even as a recommendation is coming soon from a CDC advisory panel, the decision ultimately will be made state by state.
Noninterest income has bolstered profits this year. But its growth is expected to slow over the next two years, making for a gloomy earnings outlook unless vaccine distributions and the economic recovery are relatively swift.
The Biden administration could curtail federal support for farmers, even with bankruptcies and requests for loan workouts on the rise. Banks are hoping that increases in crop prices and exports to China could help avert a credit crisis.
Executives from U.S. banks continue to play down near-term expectations, but they say customers are growing more confident ahead of the rollout of coronavirus vaccines, and that key commercial lending segments could drive an economic rebound.
Some lenders are poring over commercial portfolios more frequently than normal — perhaps as often as once a month — to uncover problems hidden by payment deferrals and government stimulus before it's too late.
Hospitality sector credits are coming out of forbearance just as coronavirus cases surge. Restructurings and charge-offs could mount unless vaccine distribution happens quickly enough to jump-start travel by mid-2021.
The Federal Housing Administration said in its annual actuarial report that the capital reserve ratio on its mutual mortgage insurance fund increased to 6.10% in fiscal year 2020, up from 4.84% a year earlier.
Lenders pushed back against the notion that city dwellers' pandemic-driven flight to suburbia would hurt them. They say fewer landlords have sought deferrals as vacancy rates remain low and rent collections have stabilized.
The subprime lender cited low odds that Washington will deliver further economic relief, and the fact that $1.5 billion of loans whose deferral period expired are now more than 30 days behind.