BBVA Has Renegotiated 66,166 Mortgages Since Start of Crisis

2 June 2015 – Expansión

BBVA has refinanced 66,166 mortgages and granted 11,680 “daciones en pago” (assignment of deeds in lieu of payment) since the start of the crisis, according to the report ‘BBVA’s Social Impact in Spain’, which was presented by the entity yesterday, having been prepared in collaboration with KPMG. The report seeks to quantify and detail the social impacts associated with the bank’s activity.

In Spain, 896,203 families live in homes financed by BBVA and during 2014, the entity granted new loans worth €1,379 million to 13,394 families for the acquisition of first homes. In addition, it financed 17,416 homes so that they could undertake energy efficiency improvements.

In terms of employment, BBVA has launched various initiatives such as “Yo Soy Empleo”, which has granted direct aid for the recruitment of almost 8,500 people; and “Project Momentum”, which has a 60% job placement rate.

The total number of jobs linked to the bank’s activity, including indirect or induced roles, amount to almost 100,293 people, i.e. 0.6% of the active Spanish working population.

Meanwhile, 951,284 individual shareholders received an average dividend of €870; 940,367 people have pension plans; and 875,448 employed people are covered by employment pension plans managed by BBVA.

Original story: Expansión

Translation: Carmel Drake

Cataluña: Banks Have 3 Months To Confirm Stock Of Vacant Homes

25 March 2015 – El País

Financial institutions, investment funds and the bad bank – Sareb – will have three months to inform the Generalitat about the number of empty homes they have on their books as a result of foreclosures or the assignment of deeds in lieu of payment (“daciones en pago”). Using this information, the Catalan Government will be able to impose a tax on vacant homes (the corresponding bill is currently with the Parliament) and undertake the necessary actions to establish their condition and demand their refurbishment. The decree that creates the register, approved yesterday by the Consell Executiu, also includes a pre-emptive purchase option by the Public Administrations of the homes whose residents are at risk of being evicted.

The Ministry for Housing, led by Carles Sala, wants to increase its stock of social homes in areas with highest demand. The urgent measure decree law to mobilise homes resulting from mortgage foreclosures establishes that the Public Administrations may exercise “their pre-emptive rights and rights of first refusal” – i.e. to a preferential purchase – when a company, financial institution, investment fund or Sareb is going to sell a home for which a mortgage foreclosure procedure is pending in any one of the 72 municipalities with greatest demand for housing. The text will come into force when the Official Document from the Generalitat of Cataluña (Documento Oficial de la Generalitat de Cataluña or DOGC) is published, which is expected to happen this week.

Sources from the Catalan Executive explain that they estimate that the banks have between 10,000 and 20,000 vacant homes on their books in areas with highest demand. This figure, which currently ranges quite a lot, should be confirmed by the register, which all owners of empty homes in Catalaña will have to sign up to. The occupants of the homes that will be handed over to the Public Administrations – which may in turn assign them to entities in the third sector (of social economy), per the request of those entities – will have to pay a social rent amounting to €212 per month on average.

The Department for Planning and Housing, led by Santi Vila (pictured above), is already exploring the market and may announce its first transactions next week. For the time being, the Catalan Housing Agency has €8 million to make purchases, although its final budget will depend on the amount collected through the tax that it will apply to the banks’ empty homes, which may range between €8 million and €26 million. Sources from the department explain that they are not looking to purchase homes for €100,000. The majority of the homes that have eviction orders pending are located in suburban neighbourhoods, and as such they are modest flats whose market prices may be as low as €20,000 or €40,000.

The Generalitat has also found that many of the homes in the stock that have been vacated due to evictions are falling into disrepair. For this reason, the decree obliges the entities that own such properties to carry out the necessary renovation work. If they do not, there are two options. The first involves a serious fine. The Housing Law establishes fines of up to €90,000, although the Catalan Government is in favour of ensuring that the amount of these fines is commensurate with the cost of the works that need to be performed. If the financial entity that owns the home does not carry out the renovation work, the Generalitat may conduct an “enforcement”, involving the expropriation of the use of the home for a period of between four and 10 years.

In the end, the department will try to avoid any double evictions through an aid package that will be collected in April. In this case, the objective is to prevent families that have lost their homes, but that have benefitted from the assignment of deeds in lieu of payment or social (discounted) rent by the financial entity, from having to face additional procedures if they cannot afford the rent.

Original story: El País (by Lluís Pellicer)

Translation: Carmel Drake

Cataluña Will Fine Banks That Do Not Lease Out Foreclosed Homes

11 March 2015 – Expansión

The Generalitat will impose fines of up to €90,000 on banks that have homes (on their balance sheets) resulting from mortgage foreclosures and the assignment of deeds in lieu of payment, which are in a poor condition and as a result, are not leased out. The 72 municipalities with the highest demand (for housing) will be forced to transfer affected homes to the Generalitat, which, after refurbishing them, will lease them out for a maximum period of ten years. This is one of the measures contained in a law introduced to address urgent housing measures, which the Government of Artur Mas (CiU) announced yesterday.

The text also empowers the Generalitat and the town halls to exercise ‘their pre-emptive rights and rights of first refusal’ for all of the homes that have resulted from mortgage foreclosures and the assignment of deeds in lieu of payment, that the bank wants to sell. The objective is to prevent packages of properties ending up in the hands of international funds and evicting the tenants from those homes.

Original story: Expansión (by A.Z.)

Translation: Carmel Drake