This time, however, as demand has grown, larger banking organizations have managed to keep their holdings modest relative to their asset bases either through securitizations, sales or by avoiding originations altogether. In contrast, many smaller commercial banks have raised their commercial real estate concentrations relative to assets and capital.
The variation in those outcomes highlighted the considerable uncertainty in the economic outlook at the time and how that would translate to banking conditions in coming quarters. Accordingly, we required banks to resubmit their capital plans and took several actions to preserve capital in the interim.