Banks in Spain have property to offload after the real estate crisis
They are officially banks but they have become Spain’s main real estate agents, according to data from the country’s banking sector which reveals the extent of their risky property assets. The Bank of Spain had asked all 17 of the country’s fragile regional savings banks, which account for about half of all lenders, to supply it with details of their exposure to the collapsed real estate market.
Unsurprisingly, the savings banks held far more risky assets than the main banks, based on a calculation of the figures last week by AFP. The nation’s seven main banks held 45 billion euros ($61 billion) in risky assets and the 15 of the savings banks that have so far published their figures had around double that, or 90 billion euros.
The difference is due to the huge amount of mortgage loans — some 164.9 billion euros worth — that the savings banks handed out during the property bubble, whereas the main banks only issued some 77.5 billion euros. The savings banks are at the heart of market fears that Spain could need a bailout like the ones granted Ireland and Greece last year.
A good estate agent in Tenerife for example will have details of many repossessed property bargains by banks and will be more helpful with details of the location than any savings bank may be in my opinion.
