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BBVA Refinanced €5 Bn in Credits More Than Twice

19/11/2014 – Expansion

The value of loans that BBVA refinanced more than two times amounted to around €5 billion at the end of 2013, the entity reported to the National Stock Exchange Commission (or the CNMV).

The bank chaired by Francisco Gonzalez (pictured) established a two-time limit for every 24 months of the loan’s life in case when clients apply for refinancing. Specifically, BBVA classifies most of the refinanced-more-than-twice credits as ‘doubtful for subjective reasons’ if they are outstanding or ‘doubtful for arrears’ if they are defaulting.

Total refinancing of the group showed almost €30.92 billion as per 31th December 2013, a 6.7% increase from the same day a year earlier. Having in mind the forecasts, total net refinancing reached €23.99 billion. Thus, debt refinancing and restructuring by BBVA accounted for 7.4% over the clients’ credit balance, substracting off the provisions which rose from €4.16 billion to €6.92 billion.

As the asset reclassification imposed by the Bank of Spain aiming at standardising portfolios showed, the entity led by Mr. Gonzalez has got refinancing records categorized as ‘doubtful risk’ totalling at €14.83 billion (end of 2013), by 72% more from 2012. Also, the process resulted in giving BBVA the ‘substandard’ label for its €8.42 billion balance in 2012. The amount shrank to €6.43 billion in 2013. Finally, refinancing of the ‘normal’ type of loans decreased from 11.95 billion to €9.66 billion.

 

Original article: Expansión 

Translation: AURA REE