New Basel III standards have prompted banking regulators, includingthe FDIC, to propose tougher capital rules on banks of all assetsizes that could hamper the for-profit institutions' ability tofund commercial real estate.
Specifically, large and community banks would be subjected to a150% risk weight that would apply to some loans that finance theacquisition, development or construction of commercial real estate,according to proposed rules posted on FDIC's website.
Banks have complained in trade publications that thosestruggling to meet new capital benchmarks will have to reducebusiness lending as a result.
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