The incidence of strategic defaults by some borrowers with loans for forestry investment schemes may have subsided at Bendigo and Adelaide Bank at the end of the September 2009 quarter.The bank's "pillar 3" report for the quarter shows a rise in impaired loans and loans more than 90 days past due. This quarter's report, however, consolidates credit exposures and impairments for Rural Bank for the first time.Taking into account the separate disclosures for Rural Bank, it appears the level of impaired assets and past-due loans at the core banking business of Bendigo and Adelaide Bank fell over the quarter.The bank reported $244 million of impaired "other retail" loans, of which $41 million are due to Rural Bank. Bendigo reported impairment in this category of $194 million at June 2009.The bank reported past due loans of $127 million in the same category at September, of which $40 million was for Rural Bank.