Moving to one last credit risk management issue: Community bank loans to finance real estate construction rose 7.4 percent over the second quarter. This increase continues a remarkable trend in which commercial real estate--or CRE--lending has accounted for virtually all asset growth at community banks.
For newer payments mechanisms, we do not strive to become an active provider. However, we can encourage private-sector initiatives and remove regulatory hurdles to experimentation, where appropriate. We can also help, in collaboration with the private sector, to overcome barriers and market imperfections.