As they say, bank performance follows credit. Right now banking is good because credit is good. Credit performance for the second quarter of 2018 improved over the first quarter. While investor commercial real estate has seemed to hit is high point back in 2Q of 2017, C&I and owner-occupied real estate continue to improve. According to our analysis derived from Paynet data, the average probability of default (POD) for small and mid-sized businesses was 2.28%, a decrease of 3.8 basis points, or 1.7% improvement over last year.