Jun. 7--Bankers need to look no further than their first-quarter financial reports for a reminder that Southern Nevada's economy is in a slow, whining fall.

The hottest markets during the good times are getting beaten up the worst during the recession, said Tim Coffey, vice president of FIG Partners, a stock brokerage specializing in bank stocks. That includes Las Vegas, Phoenix, Southern California's Inland Empire and parts of the Pacific Northwest, he said.

Coffey agrees with analysts who predict commercial real estate loan problems loom for banks.

"It's going to happen, and it might be worse in this market," he said. "We're not seeing it yet, because a lot of the loans haven't come up for maturity."

Many loans secured by commercial real estate face balloon payments starting this year, increasing next year and declining some in 2011. Values have declined as vacancy increased and rents dropped, he said.

"Retail is the worst," he said. "Hotels seem to be better."

He mentioned three outcomes: the borrowers could put up more collateral for the loan, find another lender or watch as the bank forecloses.

In Western states, he expects tougher bank regulation and seizures of some institutions, but Coffey said Florida and Georgia are the epicenter for failing banks. Since July, four Nevada-based banks have been seized.

During the first quarter, the surviving banks got little relief from the worst recession in decades.

With a few exceptions, state chartered banks in Nevada lost money. However, many of them have large amounts of capital or equity that allow them to absorb the losses and continue in business.

About half of community banks continued to pump out new loans, more than offsetting the loans that were paid off and those that were charged off. (See related story)

In addition, many community banks attracted new deposits, reversing the previous flight to the perceived safety of giant regional and money center banks.

Bill Martin, chief executive officer of the $188 million-asset Service1st Bank, said he is attracting customers who feel that other banks are pushing them away.

"Daily I receive phone calls from longtime borrowing customers of other banks who are being treated very aggressively in terms of collection efforts, probably for a good reason but seemingly without regard to those long-term established relationships that have existed," he said in an e-mail. "Our board has discussed and endorsed that we will make every effort to do what is right for both our customer and ourselves so that the loyalty and relationships -- both ways -- remain when this economic nightmare has passed."

Yet, some banks continue to rely on brokered deposits, which are considered hot money, for some of their funding needs.

Brokered deposits are like hot sauce, a little bit can help but a lot can create financial heartburn. How much is too much? The Federal Deposit Insurance Corp. charges a deposit-insurance premium for brokered deposits that exceed 10 percent of total deposits, providing at least a benchmark for acceptable levels of brokered deposits.

Investors who buy certificates of deposit through stockbrokers are looking for yields and are often ready to pull their money when they can get higher rates elsewhere or when they suspect a bank may be set to fail.