American Banker (02/29/08) P. 18; Davenport, Todd
Citing their exposure to commercial real estate (CRE) and residential construction, Moody's Investors Service Inc. this week downgraded a number of regional and community banking firms. Among those downgraded were Regions Financial Corp., Synovus Financial Corp., Trustmark Corp. and Zions Bancorp. In its report, the agency wrote: "Recent trends bear out what we have been concerned with for some time--that sizable CRE loan concentrations increase the potential for asset quality and earnings volatility. Those that are heavily concentrated in CRE not only face potential credit losses from an industry downturn, but they may also experience a material decline in revenue from the associated slowdown in demand."
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