Spanish bank bad loans hit 16-year high
Spanish banks' bad loans, a major source of concern to the financial markets, surged to the highest level in 16 years in April, the Bank of Spain said Friday.
Bank loans whose recovery is in doubt amounted to 115.35 billion euros ($165 billion), or 6.36 percent of total assets, in April -- the highest ratio since June 1995, the central bank said in a report.
That compared to a bad loan ratio of 6.11 percent in March.
Investors fret over the state of Spanish banks, hard hit by the collapse of property bubble in 2008, an ensuing recession and a steep rise in the cost of raising money on financial markets in past months.
The government and Bank of Spain have forced a wave of consolidation in the sector and are requiring banks to quickly increase the proportion of rock-solid core capital they hold to above international norms.
© 2011 AFP