Robert Maddox Quoted in BBJ on Birmingham's Largest Banks Proceeding with Caution into 2024
November, 2023 - Birmingham, Alabama
Bradley partner Robert Maddox was quoted in the Birmingham Business Journal on several of the metro area’s largest banks raising their allowances for credit losses.
Maddox pointed out banks are being squeezed from multiple directions right now. “You saw a credit issue on one side,” he said. “You saw a depository issue on another side. You’ve seen this interest rate hike that hits everybody, and now we’re starting to see the capital issues.”
Some segments of commercial real estate are performing well for now, he said, but office properties have been hit hard, especially in Birmingham’s downtown areas.
He also pointed out a large portion of commercial real estate office loans are coming due soon, and current interest rates will make it difficult to refinance loans for many office properties.
“These loans are coming due, and when they originated, they were somewhere between 2% and 3%, and now they’re somewhere between 7% and 8%. And that’s a significant difference,” Maddox explained.
He said he thinks it’s sensible for the firm’s banking clients to be skeptical about what’s in store for the year ahead. “2024 is going to be a rough year,” he predicted.
The full article, “Birmingham's largest banks cautious going in to 2024,” was published by the BBJ on November 19, 2023.
