The real estate default increased tenfold since early 2008 - Growth ...

Since the crisis began in 2008, the Spanish financial sector accounts have been seriously damaged by late payment of real estate companies, which rose from 1.98% in the first quarter of this year to 20.9% it closed 2011.

According to recent data published by the Bank of Spain of 298.267 million euros to the Spanish financial institutions were granted at the end of last year to real estate companies were delinquent 62.366 million, a figure that grew by 4.789 million in one quarter.

In fact, between July and September 2011, the delinquent real estate companies stood at 18.97%, as there were 57.577 million euros a portfolio outstanding of 303,506,000.

As for the interannual evolution, real estate delinquencies rose seven basis points from 13.98% recorded in the last quarter of 2010 to 20.9% one year later, for a real estate loan portfolio totaled 315.782 million then , which fell in that period 17.605 million.

The Bank of Spain data also reflect strong growth in the delinquency of construction firms, and ended the year with 17.65% of outstanding claims, well above the 12.12% they had in December 2010.

Compared to the previous quarter, the difference was just over one and a half points, as it stood at 16.09%.

The real estate and construction activity has gone from being the main driver of the Spanish economy its biggest drag in just four years, as has happened with the accounts of banks, which carry a much lower overall arrears of these depressed sectors .

In particular, late payment of credit extended by banks, savings banks, cooperatives and credit institutions closed 2011 at 7.61%, its highest level of the previous 17 years, particularly since November 1994 when it stood at 8%.

This rise in defaults is a result of increased bad debts, which in December 2011 reached the EUR 135 838 000 134 227 000 compared to November, according to Bank of Spain.

Of that amount, the questionable real estate and construction touched the 80,000 million euros, standing at 79.759 million, which means that 58.7% of defaults across the Spanish financial sector came from this sector.

But the situation was much worse a year ago, as the unpaid real estate accounted for 73% of total bank dubious, almost three quarters of the portfolio outstanding.

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