Spanish banks NPLs fall to 2010 lows

Eight Spanish banks brands amongst the 500 most valued worldwideThe first quarter was particularly damaging for the banking sector, coinciding with the start of the coronavirus crisis

Bankinter |  The rate of Spanish banks´non-performing loans fell in March to 5.73% (-1.07 pp m/m), the lowest level since 2010. It is good news for the sector, which confirms the improvement in the credit quality indices observed in recent years. Bad debt is therefore distancing itself from the highs of 2013 when it reached 13.61% in the middle of the economic crisis in various Eurozone countries.

The improvement in non-performing loans is explained by the recovery of the Spanish economy (fundamentally GDP and unemployment), the maintenance of attractive financial conditions (low interest rates) and the banks´ efforst to sanitise their balance sheets. It should be remembered that in 2018 the banks sold 72.646 Bn€ of non-performing assets (+28.0% yoy).