A number of U.S. banks saw continued pain in the third quarter on delinquent commercial real estate (CRE) loans in their portfolios, as stress in the sector persists, Reuters reported. Building owners that borrowed money to finance their properties are being squeezed by high interest rates and vacant offices as workers opt to work from home. Weak demand for offices could trigger a wave of borrowers to default on their loans and put pressure on banks and other lenders, which are hoping to avoid selling loans at significant discounts. As a result, banks recorded continued provisions for credit losses and charge-offs from the previous quarter, driven by their non-performing (NPL), or delinquent, CRE loans.
