Despite the uncertainties that hover over the economy and the fear of defaults on loans guaranteed by the Official Credit Institute (ICO), delinquency continues to decline. The big banking (Santander, BBVA, CaixaBank, Sabadell, Bankinter and Unicaja) has seen caer in 7,875 million euros its portfolio of non-performing loans and of those others with doubts about his future behavior between June 2021 and last June, with a parallel decline in provisions endowed to cover said exposures of 1,173 million.
The improvement is influenced by the favorable evolution of non-payments and possibly also by the recurrent clean-up in some entities with the habitual use of bad debt portfolio sales, while the Bank of Spain has spent months prescribing prudence and do not deduct provisions for what could come.
one of the great incognitos is the behavior of credits guaranteed by the ICO It has hardly had any incidents. Until Junecompanies and freelancers still could take advantage of the shortcomings in the payment of the principal, so that it will be necessary to wait for the numbers of the following quarter to start testing the payment capacity of its holders.
With the data closed to June and according to the financial reports published by the entities, the vast majority reduced their delinquency rate thanks to the good performance in terms of payments and the increase in financing. This ratio, which is calculated as a ratio between delinquency and credit, it fell in all entities except Unicaja (it went from 3.2 to 3.5%) and with cuts of between the 4 basic points of CaixaBank (it went from 3.6 to 3.2%) and the 23 obtained by Bankinter (it was reduced from 2.34 to 2.11%).
All reduce default
When the magnifying glass is put on the portfolios, the risk exposure of large banks fell by 3.57% year-on-year y stood at 212,417 million of euros. Of that amount, the delinquent financing or qualified in financial jargon as ‘stage 3’ amounted to 38,167.69 million of euros (-2.89% year-on-year) and others 145,226.13 million (-4.38%) corresponded to transactions accounted for as ‘stage 2’ orn special surveillance, drawer where they place those credits up to date with payments but about which there are future doubts due to the situation of their holder or the vulnerability of the sector where the activity is carried out.
The entity-to-entity situation differs. Only Santander and CaixaBank reduce total exposurealthough almost all reduce the supply bank and the majority reduces the default portfolio but they raise the credits accounted for under special surveillance as a precaution.
The Bank of Spain encourages, in fact, to carry out a meticulous follow-up of the operations guaranteed by the ICO and put special zeal in those linked to affected sectors due to the situation caused by the Russia war, pandemic and inflation. It is even favourable, to begin its classification as ‘stage 2’ and make the corresponding allocation to recognize that its probability of default is greater.
The Cantabrian group drops 3.16% year-on-year lThe global portfolio at risk, up to 95,747 million euros, thanks to the fact that the portfolio in ‘special surveillance’ decreased by 5.82% and the non-performing portfolio grew by 2.60%. In CaixaBankthe total exposure at risk falls by 13.65%, to 40,501 millionwith reductions of 14.44% in financing under special surveillance and 11.47% in that which has already presented defaults for at least three consecutive installments (regulatory term to classify an operation as doubtful).
BBVA barely reduces the portfolio by 0.73%which is located in 46,917 million, although it reduces by 2.77% the exposure with defaults and increases by 2.40% that classified as ‘stage 2’ or with doubts about its future performance. Similar happens with Sabadell, whose total exposure at risk grows by 3.74%, to 19,328 millionbecause the portfolio labeled as potentially vulnerable in the future has increased by 7.76%, while falls by 4.69% that which drags real default.
Another example is Bankinterwhose total exposure at risk scales 13.32% and is located in 4,398 million after increasing the ‘stage 2’ financing by 25.46% and despite the fact that defaults fall by 1.68%. In Unibox happens the other way around: the total risk climbs by 1.61%, up to 5,526 millionwith declines of 1.37% in potentially vulnerable financing and increases of 7.47% in credits with defaults.