Bad Residential Construction Loans Dragging Down Spokane Banks

Spokane normally lags the rest of the country by six or more months. Reports like this have been common in other markets around the country are now showing up locally. Along with the bad news will come opportunities in Spokane real estate for those not faint of heart and understand the times.

clipped from spokanejournal.com Bank reports give insights into economy Nonperforming assets rise sharply at institutions here as quarterly profits plummet By  Richard Ripley One of the most-watched numbers in bank earnings reports for the third quarter, which ended Sept. 30, will be nonperforming assets—and how they’ve grown amid the nation’s financial and economic crises. Peter Stanton, chairman and CEO of Washington Trust Bank, says that banks’ financial results “absolutely” reflect what has happened in the economy, and growth in their nonperforming assets “certainly reflect recessionary-type issues.” Byrne says, “In our case, our nonperforming assets are very heavily weighted toward residential construction loans.” With home sales down sharply in the region, that’s no surprise, especially with Sterling having reported for months that such loans were problematical. Sterling says its nonperforming assets related to residential construction jumped by 31.5 percent, or $75.9 million,