Spanish banks are trying to protect its system from the burst of country’s property bubble. In July the Central Bank of Spain made changes in order to facilitate provisioning rules on risky mortgages. According to new changes, banks have to allow for the difference between the value of the loan and 70% of the property’s market value. One of the analysts from Iberian Equities assumes that new changes would relieve banks of the need to make provisions of about €22 billion in coming months (assuming non-performing loans reach 8% by the end of 2010).

Real the Full Article