Within BBVA’s real-estate activity in Spain, there has been a notable reduction of exposure linked to the developer sector and an upward trend in retail foreclosures, in line with the gross additions to NPA in the residential mortgage portfolio. Sales of foreclosed assets have also gathered pace since the second half of 2012.
The income statement in this area mainly reflects the expected impact on loan-loss provisions, the increased pace of sales of foreclosed properties and the write-down of those foreclosed assets to their market value.