Bad loans as a proportion of total lending at Spanish banks climbed to 6.1 percent in January,
Bad loans as a proportion of total lending at Spanish banks climbed to 6.1 percent in January, the highest level since 1995, as the country struggles to emerge from a property crash.
Bad loans jumped to 110.7 billion euros ($156 billion) from 107.2 billion euros, or 5.8 percent of total lending, in December, the Bank of Spain said on its website. The January figure compared with 96.4 billion euros in the year-earlier month, which represented a bad-loans ratio of 5.3 percent.
Risky loans on the balance sheets of Spanish banks have soared as the country struggles to emerge from the worst recession in 60 years, which drove unemployment above 20 percent and caused a surge defaults on debt linked to real estate. The total amount of “potentially troubled exposure” linked to construction and property is 181 billion euros, the Bank of Spain said in its October financial stability report.
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