Commercial banks continued to see their investment in residential MBS slowly evaporate during the third quarter of 2013 even though the overall market appears to finally be growing again. A new Inside MBS & ABS analysis of recently-released call report data shows that commercial banks and thrifts held a combined $1.513 trillion of residential MBS as of the end of September. That was down 1.0 percent from the end of June and represented the lowest level since the middle of 2011. Depositories and other private MBS investors have...[Includes two data charts]