HomeIndustriesBerkshire Vice-Chair Warns That Banks Stuck With Commercial Property Debt

Berkshire Vice-Chair Warns That Banks Stuck With Commercial Property Debt

Berkshire Hathaway Inc. vice-chair Charlie Munger wanted U.S. banks to continue to be burdened by bad loans, thereby indicating that trouble could lay ahead for the commercial property market.

Despite its long history of providing financial support to struggling banks, Berkshire has decided to remain on the sidelines since the collapse of Silicon Valley Bank and Signature Bank and the banking sector instability that followed. Munger revealed that this decision largely comes as a result of the risks associated with banks’ portfolios of mounting commercial property loans.

“A lot of real estate isn’t so good anymore,” Munger said to the Financial Times. “We have a lot of troubled office buildings, a lot of troubled shopping centers, a lot of troubled other properties. There’s a lot of agony out there.”

Munger added that Berkshire’s decision to refrain from intervening to assist amid the sector’s instability comes as every U.S. bank tightens their stances on real estate loans, further discouraging the firm from intervening.

Home Prices Rise for Second Straight Month

U.S. home prices increased for a second consecutive month in March, reflecting the sustained inventory shortage faced by buyers. This streak comes after seven...

Futures Rise as Debt Ceiling Deal Set for Next Challenge

U.S. futures advanced during Tuesday's morning session as investors wait for the U.S. debt-ceiling deal to be presented before Congress. Policymakers are under pressure...

Oil Remains Steady as Traders Await Approval of Debt Ceiling Deal

Oil remained little changed on Monday as traders wait to see if lawmakers approve the U.S. debt ceiling deal that policymakers agreed to on...