WASHINGTON, DC–Washington DC is trying to give banks and their commercial real estate borrowers some relief from the High Volatility Commercial Real Estate Loans, or HVCRE, rule.
This rule, promulgated by Basel III, went into effect in 2016. It established a new risk-weight category requiring banks to hold more capital — 150% or one and half times as much — for such loans.
The result was a pull back on construction lending among other types of bank finance.
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Erika Morphy
Erika Morphy has been writing about commercial real estate at GlobeSt.com for more than ten years, covering the capital markets, the Mid-Atlantic region and national topics. She's a nerd so favorite examples of the former include accounting standards, Basel III and what Congress is brewing.
