Credit quality improved in all major loan categories at commercial banks, savings banks and thrifts, except for single-family loans, according to the Federal Deposit Insurance Corp.
Noncurrent single-family loans (90 days or more past or in nonaccrual status) rose by 4% as a “result of the application of more stringent methodologies for recognizing impairments in junior liens,” the FDIC said on Thursday.
Earlier this year, the regulators directed banks to update their information on the collectability of their second liens and the delinquency status of the related first mortgages.
FDIC-insured institutions held $1.75 trillion in closed-end single-family loans as of March 31. The noncurrent rate on those closed loans rose to 9.87% in the first quarter, up 24 basis points from the prior quarter.
The noncurrent rate on home equity lines of credit hit 2.4% in first quarter, up 57 bps from the fourth quarter.
The Federal Deposit Insurance Corp. also reported Thursday that over 1,000 FDIC-insured institutions originated $181.2 billion in single-family loans in the first quarter.
The quarter report includes origination data from FDIC-insured thrifts for the first time.
In the fourth quarter, 762 commercial banks and savings institutions made $151.2 in first-lien one-to-four family loans.
The FDIC collects origination data only from insured depositories that originate more than $10 million of residential loans in the quarter or have $1 billion or more in assets.
There are currently 7,307 FDIC-insured institutions and only 1,022 reported origination data as well has loan repurchases.
Despite the increase in reporting institutions, loan repurchases and indemnifications cost the depositories $3.3 billion in the first quarter, down 24% from the fourth quarter.
