International property investors are keeping a close eye on the Federal Deposit Insurance Corporation in the U.S. for notices about bank closures.
The Federal Deposit Insurance Corporation (FDIC) is an independent agency created by the Congress to maintain stability and public confidence in the nation’s financial system by: insuring deposits, examining and supervising financial institutions for safety and soundness and consumer protection, and managing receiverships.
At the Real Estate Forum, December 2, 2009, Michael McDonald, Managing Director, Eastdil Secured there are approximately 520 banks on the U.S. Federal Deposit Insurance Corporation (FDIC) watch list because they are carrying excess debt, a large proportion of which is commercial real estate. Many of these banks are expected to fail over the next year. There are about 8,000 banks in total in the U.S.
For investors there may be an opportunity to acquire real estate assets when banks are taken under the wing of the FDIC. While many U.S. lending institutions have been extending loans to commercial real estate owners, regional banks in particular are reaching their limit with respect to being able to carry a lender in default.
The first page of the FDIC website provides a summary of Bank Closing Information that is updated regularly.