Spanish Bad Bank – 'SAREB' To Pay Steep Discount

Bad Spanish Bank: SAREB

El Mundo has:

The idea behind the bank is that distressed loans can be handed off to this bank after a haircut. It is expected to yield 15% on equity, due to severe haircuts.

We are talking an average rebate of 63%. Building land 79.5%, buildings under construction 62.3%, finished buildings 54.2% and loans to developers 45.6%

That is paying 20 to 50 cents on the dollar for these loans.

This bank should live for 15 years maximum.

Bankia, Catalunya Banc, Novagalicia Banco y Banco de Valencia – al banks in FROB (the public dustbin bank) – will transfer 45 bio. EUR worth of “bricks”. After that banks that have received public aid should transfer other 15 bio. EUR. Estimated potential volume is 90 bio. EUR.( And NO I don’t know if it is before or after impairment.)

Comment:

The idea is neither new nor bad!

SORRY!

This content is exclusively for paying members. Access all of our content on including years of timeless investment news and in depth analysis for only a few dollars a month by signing up here while also supporting quality content and journalism, or learn more about our premium content here

If you are subscribed and having an account error please clear cache and then cookies if that does not work email support@valuewalk.com and we will get back to you as quick as humanly possible


Saved Articles
X
TextTExtLInkTextTExtLInk

Are you a smart investor? Join tens of thousands of sophisticated investor reading our authoritative free newsletter

* indicates required

Opt out of occasional 3rd party offers


Congrats! Are you a smart person? We have a limited time offer for sophisticated and loyal readers like yourself.

Sign up today and get three months free

Use coupon code VIP19 or click on the button below

Limited time offer only expires 8/31/2019 or next 30 now just 2 subscribers whichever comes first – please do not share this discount with others

 

0