Fed Chair Ben Bernanke may be regretting the speeches he gave which tried to comfort investors with the idea that problems in the subprime mortgage market were contained. Yesterday, I posted about how banks, already nervous about subprime loans, are stiffening terms for other borrowers -- like those in private equity.

Today, the Wall Street Journal [subscription required] reports that bad loans are growing in a new category -- commercial mortgage-backed securities (CMBSs). CMBSs are packages of mortgages made to companies which buy real estate for operating their businesses -- such as retail stores in malls. CMBS delinquencies rose 13% in the second quarter to $1.65 billion from $1.46 billion in the first quarter, according to Standard & Poor's, which attributes the rise to overaggressive loans -- e.g., interest-only loans, which allow borrowers to forgo paying down loan balances -- made in 2006, as well as increased problems in the retail sector.

This is the first I've heard of the problem. And it suggests that there is even more trouble ahead -- commercial borrowers took out more loans than than their properties were worth in the second quarter of 2007 -- 117% more than their properties' values to be precise. What is probably going on here is that bankers generate such high fees making the mortgages and selling them that they loosen their credit standards so they can add even more new loans to their portfolios. The problem comes when the unsuitable borrowers can't repay.

Maybe Bernanke is trying to project confidence when he makes these statements. But when reality is at odds with what he says, that confidence evaporates.

Peter Cohan is president of Peter S. Cohan & Associates, a management consulting and venture capital firm. He also teaches management at Babson College and edits The Cohan Letter.