Moody´s Praises Spain But Warns Banks About Default

25/02/2014 – Expansion

Moody´s agency surprised on Friday by evaluating Spain at Baa2 and expressing a positive outlook. The improvement in the macroeconomic field will fuel revival in banks. In fact, if Moody´s used weak economy argument to justify the meagre rating during the recession, now the agency will have to change the tendency and also add to banking note.

However, the firm pointed out the high mortgage defaulting of banks that marked record 13.6% in December and the loan limit used rate fell down (from 74% in 2012 to 58% in 2013). The movements have been vastly produced after transferring €75.000 million in toxic assets to Sareb. (…).

In mid 2013, the Bank of Spain obliged banks to conduct the reclassification of the appropriation that resulted in 11% mortgage outstanding. If it had not been to that step, the defaulting would be equal to 12.2%.



Original article: Expansión

Translation: AURA REE