The non-performing loans (NPL) ratio of Spanish banks remained unchanged at 3.50% in July, after falling by nine basis points in June, according to the latest provisional data published by the Bank of Spain.

The Bank of Spain’s provisional figures show that the NPL was unchanged at 3.50% in July, after falling by nine basis points in June.

Thus, the doubtful assets ratio fell by 35 basis points compared to July 2022 and remained at its lowest level since December 2008, when it stood at 3.37%.

The  lack of change in the ratio can be explained, on the one hand, by the €399 million reduction in the volume of doubtful loans held by deposit institutions and financial credit institutions, to €41,774 million, the lowest volume since July 2008. Compared with the same month in 2022  compared with the same month in 2022, doubtful loans decreased by €5,661 million.

On the other hand, in the seventh month of the year, total credit granted contracted by €11,119 million, to €1.194 trillion. The slowdown is more pronounced in the annual comparison. Compared with July 2022, the decline is €38.08 billion.

The data broken down by type of institution show that the doubtful assets ratio of all deposit institutions (banks, savings banks and cooperatives) closed July at 3.39%, the same ratio as in July 2022. 3.39%, the same ratio as the previous month and down from 3.77% a year earlier.

The NPL ratio of financial credit institutions rose to 6.43% in the seventh month of the year, up from 6.33% in June and above the 6.28% a year earlier. 6.28% a year earlier.

According to data from the Banco de España, provisions for all credit institutions fell to €30,102 million in July, down 1.4% with respect to the previous month and 9.3% with respect to July 2022.

Original Story: Europa Press | Europa Press
Photo: Photo by Victor Iglesias from FreeImages
Translation and edition: Prime Yield