Chicago-based First Midwest had $ 1.7 billion, or 17%, of its commercial loans on deferral plans as of June 30. “I think it will be less than half that amount in the second round,” bank chairman Mark Sander told analysts on July 22. “Can be significantly less than half. But that, as we have told our customers about, I think it will be in that 25% to 40% of those who asked for it in the first round asked for it in the second round.

Yet 40 percent is almost 7 percent of outstanding commercial loans. At the end of 2009, First Midwest’s non-performing and restructured loans represented 5.3% of its portfolio.

The types of businesses that profit from forbearance are not surprising. Sectors hard hit include restaurants, franchisees of fast food chains, hotels and neighborhood shopping center owners.

Wintrust provides particularly detailed information on the types of borrowers enjoying the greatest relief. Almost 10% of its commercial and industrial customers benefit from deferral plans. But the figures for fast food franchisees are revealing: almost 34%.

Likewise, a quarter of Wintrust’s loans to retail commercial real estate customers are in arrears. Franchisees and malls combine for $ 610 million in deferrals, or 36% of Wintrust’s total of $ 1.7 billion.

Local malls are in poor condition, Richard Murphy, director of loans at Wintrust, told analysts on a July 22 conference call. Wintrust has the ability to withdraw as much money as possible from these if they fail, but, “generally the borrowers want to work with us, and we want to work with them. So I wouldn’t say we’re downsizing and running a segment of the portfolio right now, ”he said.

Chicago-based Byline Bank, with $ 6.2 billion in assets, has the highest share of commercial borrowers among the four deferral, at 18%. As of July 16, clients borrowing 10% of that total of $ 617 million had requested a second 90-day deferral, CEO Alberto Paracchini told analysts on July 24. He predicted that no more than 30% would ask for a second round.

Another wild card for the banks: Many of their forborne customers have also obtained federal paycheck protection program loans that are forgivable. As these loans run their course in the second half of this year, some struggling businesses will have to choose between even greater cost cuts than they already have and staying current on their unsubsidized bank loans. .

Paracchini pointed out the restaurants. “It will just depend on how these companies can continue to resume operations, once these companies withdraw those subsidy payments from the government guarantee side, will hopefully continue to grow their business to see what.” resemble their performance. this time and more importantly in the future, ”he told analysts.

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