Spanish rescue fund

The Spanish Government has announced details of a rescue fund of up £85 billion  to help the country's banks cope with a string of bad loans, including poor mortgages used to buy property in Spain, as well as help reform its banking system. But executing the plan will be difficult...

Spanish banks have so far coped relatively well in light of the global financial crisis, with only one small savings bank, Caja Castilla La Mancha, having run into grave difficulties.

But experts project that the worst is yet to come, which is why the Government has acted.
Unemployment currently stands at 18 per cent and is rising, which will further dampen demand for property in Spain.

Most banks have already swapped poor debt for properties in Spain from struggling developers, which has improved the non-performing loans ratio, but may cause problems moving forward.

Source: www.homesoverseas.co.uk/news