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Spanish banks' bad loans hit new high in November
January 18, 2013 / 10:53 AM / 5 years ago

Spanish banks' bad loans hit new high in November

MADRID (Reuters) - Spanish banks’ bad loans reached a new high in November, data from the Bank of Spain released on Friday showed, with loans that have fallen into arrears rising by 2 billion euros to 191 billion euros, or 11.4 percent of the outstanding portfolio.

This compared with an 11.2 percent bad loan rate in October.

Non-performing loans on the books of the country’s ailing banks have risen steadily since a decade-long property boom ended four years ago, with the country in its second recession since 2009 and one in four Spaniards out of work.

Analysts expect bad loans to keep rising in the coming months and concerns remain about the health of the banking sector, despite an injection of emergency cash from the European Union of more than 40 billion euros.

“We see bad loans going upwards at least another year, approximately till the fourth quarter, taking into account the poor economic situation and the high unemployment rate,” said Juan Pablo Lopez, banking analyst at broker Esprito Santo.

Spain’s unemployment rate hit a record of 25 percent in the third quarter to September, the highest since the Franco dictatorship ended in the 1970s.

Reporting By Jesus Aguado; Editing by Greg Mahlich

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