Construction lending was the root cause of scores of bank failures during the financial crisis and has slowed considerably since then, but that cautionary tale has not deterred banks from advocating for new rules that could revive the business.

A House bill introduced April 26 would ease some of the regulations governing so-called high volatility commercial real estate loans, which are labeled high risk because of potentially inflated values on underlying property, loose underwriting terms or other factors. As a result more of these loans, but not all, would be exempted from costly capital rules.

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