Short answer: Federal banking regulators screen for commercial real estate concentration at 300% of total risk-based capital for total CRE and 100% for construction and land development. Crossing either level is not a violation and not a limit. As of June 30, 2026, 8.7% of US banks were above the CRE level and 6.5% above the construction level. The median bank sits at 127% of capital in CRE.
What the guidance actually says
In 2006 the Federal Reserve, FDIC, and OCC jointly issued guidance on commercial real estate concentrations. It sets two screening criteria. A bank warrants closer supervisory attention if construction and land development loans are 100% or more of total risk-based capital, or if total commercial real estate is 300% or more of total risk-based capital and the CRE book has grown 50% or more over the prior 36 months.
Three points get lost almost every time this is summarized. First, these are screening criteria, not limits. A bank above them has broken no rule and can keep lending. Second, the 300% test has two parts, and the growth condition matters as much as the ratio. A bank sitting at 320% with a flat book does not meet the criterion. Third, the denominator is total risk-based capital specifically, which not every bank reports.
What crossing a threshold does mean is that examiners will look harder at the bank's risk management: its stress testing, board reporting, underwriting standards, and market analysis. Banks respond by tightening internal appetite well before they reach the number.
Where US banks actually sit in 2026
Here is the full distribution of CRE as a percentage of capital, by bank size, for the quarter ending June 30, 2026.
| Bank size (total assets) | Banks | Bottom quartile | Median | Top quartile |
|---|---|---|---|---|
| All banks | 4,290 | 50.3% | 127.4% | 218.3% |
| Under $100M | 577 | 4.0% | 26.5% | 70.1% |
| $100M - $300M | 1,224 | 36.7% | 80.4% | 151.9% |
| $300M - $1B | 1,435 | 84.7% | 153.3% | 227.1% |
| $1B - $3B | 629 | 155.0% | 219.6% | 275.6% |
| $3B - $10B | 266 | 160.5% | 229.8% | 290.0% |
| $10B - $100B | 127 | 118.5% | 212.7% | 263.6% |
| Over $100B | 32 | 20.1% | 46.1% | 67.2% |
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.
Concentration peaks in the $1 billion to $10 billion range, where the median bank runs 220% to 230% of capital in CRE and the top quartile is pressing against 290%. That is the segment where commercial real estate lending is the core business model. The very largest banks look low because CRE is a small slice of a far more diversified balance sheet, and the smallest banks look low because many do little CRE at all.
How many banks are over the line
| Screening criterion | Banks | Share |
|---|---|---|
| Total CRE at or above 300% of capital | 375 | 8.7% |
| Construction at or above 100% of capital | 278 | 6.5% |
| Both | 90 | 2.1% |
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. Of the 4,290 banks reporting a ratio, 2,479 report total risk-based capital directly; the remainder are banks electing the community bank leverage ratio framework, whose ratio is computed on tier 1 capital plus the allowance for credit losses. That denominator is slightly smaller, so their ratio reads marginally high against the guidance figures.
What this means if you are borrowing
Concentration is one of the few things that predicts how a commercial real estate loan request will be handled before anyone looks at your property. It is public, it is quarterly, and almost no borrower checks it.
A lender near or above the screening levels will run your deal through a heavier process. Approval moves above the relationship manager, the committee asks more questions, and the bank is more likely to hold firm on structure because every new CRE dollar is scrutinized internally. The loan is still gettable. It will take longer, and you should ask on the first call who signs off and by when, and keep a second bank in play.
A lender well below the levels is the opposite situation, and it is where to open with the aggressive ask. That bank has room its competitors do not, and is the one most able to stretch on advance rate, amortization, or an interest-only period without a concentration argument getting in the way.
One caution. A very low ratio is not automatically good news. A bank at 10% of capital in CRE is usually not an under-levered CRE lender with dry powder, it is a bank that does not do commercial real estate. Room only helps you if the lender is actually in the business, so read concentration alongside how much CRE the bank actually carries in its loan book.
Frequently asked questions
What CRE concentration ratio triggers regulatory scrutiny?
The 2006 interagency guidance on commercial real estate concentrations sets two screening criteria: total CRE at or above 300% of total risk-based capital combined with 50% growth over the prior 36 months, or construction and land development at or above 100% of total risk-based capital. Meeting a criterion means a bank warrants closer supervisory review of its risk management, not that it has broken a rule.
Is the 300% CRE concentration level a hard limit?
No. It is a screening threshold, not a cap. Banks may and do operate above it with appropriate risk management, board oversight, and stress testing. As of June 2026, 375 US banks were above 300% of capital in CRE and continued lending.
How many banks are over the CRE concentration threshold?
As of the quarter ending June 30, 2026, 375 of 4,290 banks reporting a ratio, or 8.7%, were at or above 300% of capital in total CRE. 278 banks, or 6.5%, were at or above 100% in construction and land development. 90 banks, about 2.1%, exceeded both.
What does high CRE concentration mean for a borrower?
A bank near or above the screening levels will subject new commercial real estate loans to closer internal review, and approval typically moves above the relationship manager to a committee. The loan is still possible, but the process is slower and the bank may hold firmer on structure. A bank far below the levels has more freedom to be aggressive on advance rate, amortization, or interest-only periods.
How is the CRE concentration ratio calculated?
It is construction and land development, multifamily, and non-owner-occupied commercial real estate loans, divided by total risk-based capital. Owner-occupied commercial mortgages are excluded, because the repayment source is the operating business rather than the property.
Where these numbers come from
Every figure on this page is computed from the FFIEC call reports that all 4,296 FDIC-insured banks file each quarter, for the quarter ending June 30, 2026. Nothing here is modeled, estimated, or sampled. You can pull any individual bank behind these distributions on Bank Peer Intel, or, if you are trying to borrow rather than benchmark, see which lenders these numbers point to on Borrower Assist.