Construction concentration: Construction concentration is construction and land development lending measured against capital, the second of the two interagency commercial real estate screens.
How it is calculated
Construction, land development and other land loans divided by total risk based capital, with the same community bank leverage ratio fallback the CRE measure uses.
Formula
Construction concentration = construction and land development loans / total risk-based capital
What banks reported in Q2 2026
Across every bank that filed for Q2 2026, the median construction concentration to capital was 29.06%, with the middle half between 10.29% and 55.54%. The right comparison is almost always the row for the bank’s own size rather than the industry line.
| Bank size (total assets) | Bottom quartile | Median | Top quartile |
|---|---|---|---|
| Under $100M | 0.00% | 5.19% | 20.17% |
| $100M - $300M | 8.13% | 21.56% | 44.07% |
| $300M - $1B | 17.41% | 37.37% | 65.00% |
| $1B - $3B | 25.39% | 45.28% | 70.65% |
| $3B - $10B | 23.61% | 40.59% | 58.47% |
| $10B - $100B | 10.07% | 34.09% | 50.88% |
| Over $100B | 0.52% | 6.26% | 14.61% |
Source: BankingLens, computed from FFIEC call reports for the quarter ending June 30, 2026. Quartiles are calculated across the full population of filing banks in each size band, not sampled. Non-insured non-deposit trust companies are left out of every statistic: they take no deposits and make no loans, so a margin or a funding cost computed for them has no meaning.
How to read it
100% is the screen. Construction gets a threshold of its own because it is the category that fails first and hardest in a downturn: the collateral is not finished, the repayment source does not exist yet, and the loan funds by draw rather than at close.
The common mistake. Reading the level without the direction. The guidance pairs the threshold with growth, so a bank that went from 40% to 90% in two years is the case the screen was written for even though it never crossed 100%.
Go deeper
- The 100% construction concentration guidance
- CRE concentration limits explained
- BankingLens pricing and what a subscription adds: percentile rank against the bank’s own FFIEC peer group, fourteen quarters of trend, and the flags an examiner reaches for first.
See also. CRE concentration, Risk-weighted assets, Nonaccrual.
Every figure on this page is computed from FFIEC call reports for the quarter ending June 30, 2026 and is not modeled, estimated or sampled. This page is generated by _tools/seo/build_glossary.mjs and carries no figure that was typed in. See our methodology and disclaimer. Definitions are general guidance, not regulatory or investment advice.