Final Report on Banking Bailout Warns About Sareb

29/01/2014 – Cinco Días

The fifth and the newest European Commission´s report on the Spanish banking bail out confirms stablization in the financial sector, saying the banks are faring well in restructuring and improve their solvency. However, Brussels alerts about the challenges faced by Sareb, hurt both by the competence of other entities and a continuous deterioration on the real estate and mortgage market.

The report highlights the retail real estate asset sales of Sareb have increased since May and rose even more in November last year. The European institutions also paid attention to Sareb´s ongoing plan to sell the mortgage loans applied with aid measures for the debtor.

The report, however, weights various risks that might result from the bad bank´s strategy, too. Firstly, the weak recovery of the Spanish economy, that could affect negatively the real estate market. (…) Sareb not only would suffer because of the competition, but also due to the possible conflict of interests, as some of its rivals are also its own shareholders.

Brussels advises Sareb “to continue adaptation of divestments” in light of these risks. Moreover, it requests the Government to keep an eye on the bad bank (…).

Original article: Cinco Días (Bernardo de Miguel)

Translation: AURA REE

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