Much has been spoken about Spain being in trouble. The UK press loves bad news and so announces stories with the same morbid glee that it would, I am sure, announce the end of the end the world. When one of the small regional banks in Spain was bailed out two weeks ago by The Bank of Spain, the British press ran the typical "Yet another Spanish bank..." story. Yet the bank in question accounts for less than 0.6% of the Spanish banking system. Spain is all about regions and small local banks as well as high street banks. This appears to be a concept that leaves us Brits confused. We try and measure everthing by our own yardstick. Yet the UK press neglects to ask how it is that Banco Santander purchased Abbey National, Bradford and Bingley and has made huge inroads in our own financial sector. So what if we were to compare the Spanish banks with their European counterparts. According to a report published today by Expansion, capital and reserves held by Spanish banks, including provisions made, amount to 7.9% of its debt which is 1.7% above the European average of 6.2%. Resources held by the Spanish banks far outweighs what the other European banks can count on. The report goes on to compare Spain to other countries, including France and Germany, and illustrates what some people already knew - yes the Spanish banks are more exposed than others when it comes to real estate investments, but in nearly ALL other areas they are actually stronger than most other banks. In terms of profit margins they are also streets ahead of their peers. For the full report please see here http://www.expansion.com/2010/06/04/empresas/banca/1275684814.html
We have also seen that the Barcelona banks have held strong, Banco Sabadell and La Caixa are conslidating their position and we should see their position grow as they snap up the weaker banks. Real estate in Barcelona has also proved to be a good refuge investment.
We have also seen that the Barcelona banks have held strong, Banco Sabadell and La Caixa are conslidating their position and we should see their position grow as they snap up the weaker banks. Real estate in Barcelona has also proved to be a good refuge investment.
Have an Amazing Weekend.
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