Sept. 29 (Bloomberg) -- Wachovia Corp. pushed harder than its peers to tap into the U.S. housing industry's boom earlier this decade, and paid the ultimate price for that strategy.

The CHART OF THE DAY shows growth in real-estate loans at five of the country's largest banks during the five-year period ended June 30, according to data compiled by Bloomberg. Wachovia had the group's steepest increase, as lending more than tripled.

Citigroup Inc., which agreed today to buy Wachovia's banking operations with help from the Federal Deposit Insurance Corp., more than doubled its real-estate lending. Bank of America Corp. and JPMorgan Chase & Co. did the same. Wells Fargo & Co. -- another bidder for Wachovia, according to the Wall Street Journal -- had a 23 percent increase.

Wachovia's lending swelled after the 2006 purchase of Golden West Financial Corp., a specialist in adjustable-rate mortgages with payment options. Real-estate loans rose 68 percent in the first quarter of 2007, the data shows.

Citigroup has more leeway to write down the loans and other Wachovia assets than Wells Fargo does, based on data that Vivek Juneja, an analyst at JPMorgan, cited today in a report.

Citigroup can absorb $35.2 billion of writedowns before its Tier 1 capital ratio, a gauge of financial strength, would fall below 7.5 percent, Juneja's data showed. By the same measure, Wells Fargo could cope with $10.4 billion. Both figures are based on estimated capital at the end of the third quarter.

To contact the reporter on this story: David Wilson in New York at dwilson@bloomberg.net

Last Updated: September 29, 2008 12:14 EDT