Corus says that while many condominium loans are still performing, that may change as developers deplete reserves they use to pay interest costs during construction.
Lagging sales will make it tough for developers to eventually pay off interest and principal, especially if buyers walk away because the value of their units has fallen by more than the amounts of deposits they put down.

As of year end, Corus said it had $282.6 million of loans that were 90 days or more past due and had stopped accruing interest, but had set aside only $71 million for loan losses, or 1.61 percent of total loans. Fourth-quarter profit fell 96 percent, it said.