The recent increase in C&I lending, along with a rise in bank holdings, is once again highlighting the issue of bank demand in the MBS market. Moreover, analysts said they still expect bank demand to remain moderate going forward.

In January, C&I holdings increased by $8 billion, noted Deutsche Bank Securities. Additionally, Deutsche Bank's equity analysts anticipate that bank C&I will continue rising as these institutions search for more revenue sources and as the economy improves.

Subscribe Now

Access to a full range of industry content, analysis and expert commentary.

30-Day Free Trial

No credit card required. Access coverage of the securitization marketplace, including breaking news updated throughout the day.