Go to main content Virginia Credit Union League Virginia Credit Union League
Home Report from Treasury’s Research Arm Offers ‘Dim Outlook’ for 2024

Report from Treasury’s Research Arm Offers ‘Dim Outlook’ for 2024

12/27/2023

Source: CU Today

There are “multiple indicators” that an upcoming economic slowdown is coming, according to a new report from the Treasury.

The 2023 annual report of the Treasury’s Office of Financial Research (OFR), which is the department’s research arm, found financial stability risks increased in 2023 and remains elevated. Among the report’s key findings related to financial stability has to do with the commercial real estate (CRE) market.

“Credit risks have built up in the CRE sector as borrowing rates have increased, pushing valuations significantly lower,” according to the report. “In particular, the office sector continues to face difficult financial conditions and struggles with weak demand, increased tenant vacancies, and declines in valuation following the rise of the work-from-home trend. Regional, smaller, and community banks are more exposed to CRE lending and, therefore, more vulnerable to increased default rates than the largest banks.”

Read more



« Return to "News" Go to main navigation

Calendar Events