Bad debt in Spain decreased by €2bn after 3 years rising

Spanish financial system total NPLs reached €195 bn in February against €197 bn of the previous month, shriking by 9 basis points to 13.6%. This rate stood at 10.40% last year time same period.

“This reduction of bad debt in Spain is due to several reasons and has different consequences for entities. Firstly, the stabilization and reduction of non-performing assets’ new additions; secondly, the fact they have been changed to write-offs and foreclosed assets, which may burden the improvement of banking balance sheets, and finally the first sellings of bad debt portfolios,” Afi’ s experts explained on Tuesday.

On the other hand, the overall credit granted by financial entities operating in Spain was of €1,453 bn in February, also under €1,457 given in previous month. It is relevant to remind that Spain’s NPLs include credit from specialized institutions for the first time since January, which increases the total balance and makes the default rate to decrease.

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The Corner
The Corner has a team of on-the-ground reporters in capital cities ranging from New York to Beijing. Their stories are edited by the teams at the Spanish magazine Consejeros (for members of companies’ boards of directors) and at the stock market news site Consenso Del Mercado (market consensus). They have worked in economics and communication for over 25 years.

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