Banking delinquency closed 2018 at 5.82%, the minimum in ten years

Banking delinquency closed 2018 at 5.82%, the minimum in ten years

The non-performing loans fell to 70,156 million from the 73,507 million in 2017

  The delinquency of loans granted by banks, savings banks and cooperatives to individuals and companies closed 2018 at 5.81%, from 6% registered in November and 7.79% in 2017, which is why it stands at minimum of ten years and falls below the threshold of 6%, according to data from the Bank of Spain.

In total, doubtful loans fell to 70.156 million euros in the last month of 2018, from 73.507 million euros for November and 97.692 for December 2017. In fact, it is its lowest level since January. 2009, when it stood at 72,403 million euros.

  In this way, the delinquency rate of Spanish banks ended 2018 at 5.82% and further away from the level of 7%, a level that was left behind in March 2018, when it fell to 6.8%, according to data from the Bank of Spain collected by Europa Press.

This figure includes the methodological change in the classification of Financial Credit Establishments (EFC), which since January 2014 have ceased to be considered within the category of credit institutions.

Without including the methodological changes, the ratio of non-performing loans would be 5.99%, since the credit balance was 1,170 billion euros in December last year.

In any case, the delinquency rate stood at 7.78 percentage points below the historical maximum recorded in December 2013, when it was placed at 13.6%.

In addition, total credit for the sector fell after three months to the upside, falling 1.52% in December compared to November, to 1.205 billion euros, while in inter-annual terms fell 3.86%.

In the month of December 2018, financial institutions reduced provisions to 42,732 million euros, which represents a reduction of 7.05% over the previous month. A year earlier, this 'cushion' stood at 58,576 million euros, so last year saw a 27% drop.

The analyst of XTB, Javier Urones, emphasizes that the continuous economic improvement is still transferred to this economic variable that nevertheless places Spain "slightly worse than the average of the countries that comprise the European Union".

According to data published by the ECB, the average rate of non-performing loans in the EU was close to 5% at the end of 2017, recalls Urones, who points out that it is precisely the Mediterranean countries that have higher delinquency rates than their Central European partners. .

The current trend of lower volume of doubtful loans and increase in the granting of loans is behind this sharp decline in the rate of delinquency in Spain, explains Urones, adding that the relationship this variable has with the unemployment rate is "Key", which warns that a stagnation in the creation of employment or an increase in the number of unemployed "can quickly translate into a rebound in the rate of default."