Tag: stress test

Sareb Sells 10.900 Properties in Nine Months, Averaging at 40 Units a Day

28/10/2014 – Expansion

Spain’s Management Company for Assets Arising from the Banking Sector Reorganization, also known as Sareb, has transferred a volume of 10.900 REO properties from January to September 2014. As its chairwoman Belen Romana (pictured) pointed out, the performance is much better than predicted as it averaged at 40 units sold every day.

At her hearing in front of the Economy Committee, Mrs Romana confirmed the plan of Sareb of repaying €3 billion indebtness this year, 50% more than in 2013.

During the one and half year of its lifespan, the bad bank has paid back more than €3.6 billion, equal to 7% of the total issued debt. At the same time, it paid almost €1.64 billion in interests.

In the first half of the year, Sareb earned nearly €1.7 billion and its Ebitda rose to €429 million. During her speech, the chairwoman put the emphasis on the fact that this strong cash flow allowed the firm to pay €100 million in monthly fees to the transferring entities.

Contribution to Success at the Stress Test

Belen Romana also assured that Sareb has modestly contributed to the good result of the asset quality review and the stress test of all eurozone entities conducted by the European Central Bank (ECB) and the European Banking Authority (EBA). And if it hadn´t been to the bad bank, they could not remove the toxic assets from their balance sheets.

Since its creation, Sareb has been meeting its main target (i.e. ‘sell & sell more’) and therefore adding to vivid movement on the market. The bad bank is said to have atrracted attention and change the perception of the Spanish real estate among investors.

 

Original article: Expansión

Translation: AURA REE

Spanish Banks Get Good Marks at ECB’s Stress Test

28/10/2014 – Expansion

Spanish banks pass the ‘stress test’ by the European Central Bank (ECB) and the European Banking Authority (EBA), taken by the eurozone entities across the continent. The examination was failed by 25 out of 123 scrutinized banks, mostly located in Italy, Greece and Cyprus. When it comes to Spain, all fifteen entites were successful, with Liberbank showing a €32 million deficit in 2013 for which it has already intended €637 million. None of them showed need of capital.

The Bank of Spain’s Governor Luis María Linde assured the good marks were no coincidence as the State undertook meaningful measures to remove the toxic assets, cover the refinancing and obtaining the €50 billion European bail-out. Out of the supervised entities, BFA-Bankia, NCG (now Abanca), Catalunya Banc, BMN and Liberbank have received a direct support from the Government.

‘If marks were given, Spain would get the best one in the part of balance revision’, said Mr Linde. In fact, this country has shown the smallest adjustment in risky assets in Europe (0.2%).

All the entities preserve a wide margin in case of an adverse economic scenario, ranging from 5.5% to 8% and representing around €56 billion in total.

‘The banks have got a solid solvency position but no guarantee for the next 15-20 years’, warned the Governor. Fernando Restoy, vice-governor, added that the sector faces ‘not at all negligible challenges’ such as infavorable regulations and ‘flimsy’ economic circumstances which harm profitability.

Lending

In line with the cautiousness displayed above, the Bank of Spain would rather say the confidence and lending will return but not abruptly. The central entity also revealed that once the Asset Quality Review (AQR) is finished, the bank will welcome any activity leading to risk reduction.

Original article: Expansión (by M. Martínez & J. Zuloaga)

Translation: AURA REE