Asset Quality
Commercial & Industrial Loans
Also known as C&I Loans, Commercial and Industrial Loans, C and I Loans, C and I Lending
Commercial and industrial (C&I) loans are bank loans to businesses for purposes other than real estate: working capital lines, equipment and inventory financing, and term loans repaid from the company's operating cash flow. They are the core product of business banking.
How C&I loans are reported and measured
Banks report C&I loans on Call Report Schedule RC-C, Part I, item 4: to US addressees and to non-US addressees on the FFIEC 031, as one line on the FFIEC 041 and 051. A loan secured mainly by real estate is reported as a real estate loan even if a business borrows it, so C&I loans are the business loans repaid from operations rather than property. Dividing C&I loans by total loans gives the share of the book in business lending.
Worked example
Source: FFIEC Call Report Schedule RC-C, Part I, quarter ended June 30, 2026: C&I loans to US addressees (RCFD1763) and to non-US addressees (RCFD1764), and total loans (RCFD2122).
Why does C&I lending matter?
C&I lending brings business deposit and treasury relationships with it, which is why commercial banks compete for it. It is also the loan type that turns early in a downturn: balances can jump at first as companies draw on credit lines (as in 2008 and 2020), then shrink as they borrow less, and charge-offs rise as weaker borrowers fail. Its trend is an early signal for both credit quality and loan growth.
C&I loans are one line of a bank's loan book. Loan portfolio analysis shows how to read the whole book from call report data: composition, concentration, growth, yield and reserves.
How do you interpret C&I lending?
Read C&I loans as a share of total loans and against C&I charge-offs. A high share points to a commercial bank rather than a mortgage lender or a real estate lender. Fast C&I growth can reflect demand or looser underwriting, so check the bank's past-due and nonaccrual C&I loans on Schedule RC-N. Many C&I loans are floating rate, so their yields reprice quickly when rates move.
How to read a bank's C&I loan book
| Range | Label | Interpretation |
|---|---|---|
| Diversified, seasoned | Strong | Granular C&I book with a stable loss history. |
| Typical | Adequate | C&I share in line with a commercial bank peer group. |
| Rapid growth | Watch | Fast growth warrants underwriting scrutiny. |
| Rising losses | Concern | Climbing C&I charge-offs signal credit deterioration. |
Frequently asked
What is C and I lending?
C and I lending, short for commercial and industrial lending, is bank credit to businesses for working capital, equipment, inventory and other operating needs, repaid from the company's cash flow rather than from real estate.
What are C&I loans?
C&I loans are the business loans a bank reports on Schedule RC-C, item 4: lines of credit, term loans and equipment loans to companies, excluding loans secured mainly by real estate.
What is the difference between C&I loans and commercial real estate loans?
C&I loans are repaid from a business's operating cash flow. Commercial real estate loans are secured by property and repaid from its rents or sale, and they are reported separately.
Why are C&I loans seen as economically sensitive?
They are usually shorter term, often floating rate and tied to business activity, so balances and losses move with the economic cycle.
Sources
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