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Weekly Talking Points 

March 20, 2023

• The impact to CRE finance from bank failures is likely reduced liquidity from the banking community, particularly from small to mid-sized institutions. Elevated CRE mortgage rates and wider CMBS spreads have reduced loan originations for balance-sheet and CMBS lenders. Read full article here. 
• The political fallout from recent bank failures is hitting Capitol Hill, and lawmakers are scheduling hearings, proposing legislation, and assigning blame. The White House also proposed tougher penalties on executives when their bank fails. Read full article here. 
• Regulators activated emergency powers to cover uninsured deposits and provide a liquidity backstop for Treasuries and Agency MBS that have seen drops in value. The latest crisis will likely play a role as the Fed reviews and proposes bank capital rules. Read full article here. 
• New York’s legislature released its counterproposal to Gov. Hochul’s budget. The bill did not include a tax on mezzanine debt/pref equity and does not implement statewide rent control. However, several of Hochul’s housing affordability initiatives were excluded. Read full article here. 
• CMBS delinquency rates rose 18 bps to 3.12%, the highest post-pandemic rate since December 2021. The recent banking crisis played havoc on CMBS markets as spreads widened and transactions were pulled. Read full article here. 

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