Financial, Real Estate, Stock Markets Trends and Current Affairs

From the WSJ:

Spanish savings banks have begun selling off the large property portfolios they acquired as collateral from loan defaults, in an effort to improve solvency ratios, a move that risks further falls in property values that could impair the value of their asset books.

In Spain, the global financial crisis that erupted in 2007 ended a real-estate and construction-based asset boom, plunging the country into a recession that has yet to end, even as many other European economies have returned to growth.

As the unemployment rate has soared to more than 19%, residential-property buyers have defaulted on loans in massive numbers, as have property developers, overleveraged in a moribund market. As lenders have assumed the collateral on defaulted loans, local financial institutions—particularly unlisted savings banks—have collected properties valued at about €8.5 billion ($12.2 billion) over the past 12 months.

I was fairly confident this would come to pass. Readers should reference this post from January: "Reggie Middleton on the New Global Macro - the Forensic Analysis of a Spanish Bank ". The first quarter was profitable, but that big bear rally really threw this off. The investment thesis is still sound, though. I may update this if the opportunity presents itself.