Housing prices will drop another 10% in 2014, according to BBVA.

The managing director of BBVA, Ángel Cano, has estimated that the real fall of prices will reach around 35% at the end of this year and could reach 45% between this year and 2014, which would mean an additional cut of 10%. It has also communicated that the institution has gotten rid of more than 8600 properties until June. Therefore, Cano considers that from now on until the end of 2014 “we could see an additional fall” of prices. As explained by the executive of the financial institution, the descent of real estate prices is very “heterogeneous” depending on the regions and the geographical areas.

In the presentation of results of the first half of the year, Cano has defended the pace of sale of real estate assets carried out by the “blue bank”, while at the same time valuing the coverage rate of 44% in its exposure to this sector after the required provisions.

In the six first months of the year, BBVA was able to sell more than 8600 properties . 6600 of these assets have been directly commercialized by the institution. The rest, around 2000 units, are promotions included in the accounting books of the institution but owned by developers which were customers from the bank.

The managing director has assured that the institution continues to reduce its real estate risk and has added that the provisions are “fairly adjusted”, taking into account that the sales have been done on the accounting value.

On the sale of the nationalized institutions, Cano has explained that BBVA will analyze “and see all documents and information book” on CatalunyaBanc and NCG.

The bank will analyze the acquisition of these two institutions looking for the generation of value for the shareholder, while ruling out the sale of any strategic asset.

The managing director of BBVA has referred to the Turkish bank Garanti, valuing its “excellent” evolution in the last quarters and its “perfect” integration within the group.


Source: El Economista