Spanish Banks Lose 49% Of Profit Since 1992 In Seven Quarters
Losses suffered over the last seven quarters effectively wiped out half the profits that Spanish banks have accumulated over the last twenty years, according to a comprehensive report on the state of the Spanish financial sector, published by Exane BNP Paribas. The report says that Spanish banks are changing from high-risk, high-return investments into utility-type investments, but with the high risk still intact.
“The cumulative loss reported during the past seven quarters (more than €90 billion) has been as big as 49% of all the profits reported during the previous twenty years,” says Exane analyst Santiago Lopez Diaz. “Basically, half of the profits reported since 1992 have evaporated due to credit losses and other impairments.”
“The key problem is that the system is facing the biggest structural decline in profitability in living memory and one which is unlikely to be reversed any time soon,” he says.
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