There are two very different realities for the Group within the real-estate sector. On the one hand, net exposure to the developer segment (lending to developers plus the developers’ foreclosed assets) has been falling every quarter and will continue to decline in the future. On the other, there are the retail foreclosures, i.e. those from the residential mortgage sector for individuals. Their recent increase has been linked to the increase in gross additions to NPA in this portfolio in 2008 and 2009, though this rate of additions is expected to slow in 2014.
BBVA’s net exposure to the real-estate sector in Spain as of 31-Mar-2014 stands at €14,169m, a decrease of 8.0% on the same date the previous year and of 2.8% since late 2013.
Non-performing assets fell with respect to the close of 2013 (down 5.7%).
Within the exposure to the Spanish real-estate sector, property securing mortgage loans to individuals have barely increased 3.0% since December 2013, marking a slowdown with respect to previous quarter-on-quarter rates of change.
As of 31-Mar-2014, coverage of non-performing and substandard loans reached 52% and that of assets from foreclosures and purchases stood at 51%. As a whole, the overall real-estate exposure coverage closed March at 45%, a slight improvement of 40 basis points in the quarter.
Sales of real-estate assets in the quarter totaled 3,078 units. If third-party sales are added to the total, the number of units sold rises to 4,996, 26.8% more than in the same period in 2013.
Net exposure to real-estate (1)
(Million euros)
Coverage of real-estate exposure in Spain
(Million of euros as of 31-03-14)
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|
|
Risk amount |
Provision |
% Coverage over risk |
|---|---|---|---|
| NPL + Substandard | 9,700 | 5,008 | 52 |
| NPL | 8,342 | 4,515 | 54 |
| Substandard | 1,358 | 493 | 36 |
| Foreclosed real estate and other assets | 13,118 | 6,755 | 51 |
| From real-estate developers | 9,159 | 5,080 | 55 |
| From dwellings | 2,961 | 1,215 | 41 |
| Other | 998 | 460 | 46 |
| Subtotal | 22,818 | 11,763 | 52 |
| Performing | 3,114 | - | - |
| With collateral | 2,833 |
|
|
| Finished properties | 2,082 |
|
|
| Construction in progress | 304 |
|
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| Land | 447 |
|
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| Without collateral and other | 281 |
|
|
| Real-estate exposure | 25,932 | 11,763 | 45 |
