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New record low for mortgages in March.

The number of mortgages awarded to families by banks reached 633.482 million Euros at the end of March, a fall of 3,8% in reference to the same period last year, according to the figures published by the Bank of Spain this morning. The balance reduced in 1.834 million Euros in a month.

The balance of mortgages has been decreasing since 2010, but the rhythm of the fall has intensified in the last few months. Banks are more and more demanding when awarding a loan, and most closed operations concentrate on properties within the stock of the institutions.

The situation is not brighter for companies. The balance of the financing on the manufacturing sector dropped in March by 8,5% down to 710.056 million Euros. It reduced in 3.355 million Euros only in one month. A situation which could worsen thanks to the new regulations on refinancing issued by the Bank of Spain, in order to prevent the banks from hiding their indebtness through this instrument. The banks warn that the refinancing is an indispensable tool to help many companies continue their activity, in spite of the cut in revenue caused by the crisis.

Consumer credits and personal loans are also affected by this fall. The total balance dropped in March by 4,3% down to 183.649 million Euros.

Source: Expansión