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Commercial, Multifamily Mortgage Debt Steady

Recent analysis by the ""Mortgage Bankers Association"":http://www.mbaa.org/default.htm (MBA) revealed that commercial and multifamily mortgage debt remained relatively fixed in the first quarter of 2011, down by only 0.1 percent from the fourth quarter.


The MBA's analysis covered the ""Federal Reserve Board"":http://www.federalreserve.gov/ Flow of Funds, which tracks and assesses the loan holdings and securities in sectors across the economy. These holdings and securities include commercial mortgage-backed securities, collateralized debt obligations, and other securities backed by assets.

""New commercial and multifamily mortgage lending offset the amount of debt paid-off and paid-down during the first quarter, leaving the outstanding balance essentially unchanged,"" said Jamie Woodwell, the vice-president of commercial real estate research at ""MBA"":http://www.mbaa.org/default.htm. ""Five of the seven largest investor groups increased their holdings of commercial and multifamily mortgages during the quarter.

""Banks and thrifts and finance companies saw declines in the balances of commercial and multifamily mortgages they hold,"" Woodwell said.

According to the report, $2.4 trillion in commercial and multifamily mortgage debt outstanding fell by $3 billion, indicating a new low relative to figures from the fourth quarter in 2010. Still, multifamily mortgage debt climbed to $800 billion, representing an increase by 0.4 from the fourth quarter.

Commercial banks still retain $794 billion, or 33 percent, of the total ├â┬ó├óÔÇÜ┬¼├óÔé¼┼ô by far the largest share of commercial and multifamily mortgages.

Meanwhile, portfolios belonging to agencies and government-sponsored enterprises (GSEs) amounted to $299 billion, or approximately 13 percent.

Debt outstanding for multifamily mortgages rounded out at $327 billion, or approximately 41 percent in total. Trailing multifamily mortgages, banks and thrifts reported holding a combined $214 billion, or 27 percent of the share in all.

City, municipal, and state governments own $75 billion, or 9 percent, followed by life insurances companies with $47 billion and the federal government with $14 billion, or 2 percent of the total.

Signaling a shift, commercial banks saw the largest decrease, with $8 billion in commercial and multifamily mortgage debt holdings out. Holdings for finance companies dropped by $3 billion, or 4 percent.

At 5 percent, the household sector witnessed the largest drop in their holdings, with agency and GSEs increasing their holdings portfolios by one percent.