Georgia Banks Fear Fallout from Commercial Loans ATLANTA, GA (WABE) - Georgia saw more bank failures in 2009 than any other state, and the next three years may be even worse. That's what local players in the commercial real estate market told a federal panel. The Congressional Oversight Panel for the Troubled Asset Relief Program, or TARP, chaired by Harvard Law School professor Elizabeth Warren, was in Atlanta today.

"We're only on the front end of this crisis," said Warren. TARP was rolled out in 2008 to help banks stabilize their balance sheets. But it expires in October, before many loans for commercial properties, like office space, multi-unit housing, and retail, come due. Warren said commercial loans are concentrated in small- and mid-size banks.

"These mortgages are going to fail, and they're already starting to fail. And we fear we're going to see more failures in 2011, 2012, 2013." The panel asked Atlanta bankers, regulators, and developers how the TARP program could be changed to soften the blow. Warren brought the panel to Atlanta, because the city has experienced extremes in the commercial real estate boom, and now, bust.

The panel will put its findings into a national report next month.
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