Bank failures are below 3.7% in the latter part of 2022, when interest rates were already climbing stratospherically
Despite the fact that the Euribor has not stopped rising. Despite the fact that in many cases mortgage costs are skyrocketing. And even with a more fragile financial situation for many families, there are no signs that mortgage and loan defaults could pose a problem for the banking system and the family economy for now. Non-performing loans issued by all credit institutions to businesses and individuals fell further in November to 3.68%, almost a tenth lower than the previous month’s 3.77%. Despite the context, this is the lowest level since the end of 2008, when it stood at 3.37%.
In the past year, from November 2021 to the same month in 2022, the number of delinquent payments has fallen from 4.2% to 3.6%, according to data from the Bank of Spain. In that period, the Euribor went from -0.5% to rising above 3%.
Overall, the volume of non-performing loans (technically the loans that are not paid for three months) amounted to 45,383 million euros, 1.44% lower than in October and 13.7% lower than in November 2021.
The NPL ratio also fell due to the total volume of credit extended to individuals and businesses. In concrete terms, this involved EUR 1,231 trillion in loans, EUR 9,000 million more than in October, which means an increase of 0.73% in relative terms, and EUR 4,000 million more than in November 2021, 32% more. These figures include consumer loans provided by financial credit institutions, which are no longer considered credit institutions since January 2014.
Without the change, the November arrears would have been 3.78%, as the credit balance in that month was EUR 1.19 trillion, excluding credit from financial institutions.
Most expensive continuous cards
In this sense, the Asufin organization has revealed that revolving cards (those that accrue a debt that is paid little by little, but generates itself as they are spent) have increased their market price by a percentage point in a year, from 20.17% up to 21.15%.
This is the second consecutive year of an increase in rates, following the adjustment between 2019 and 2020. As a result, the difference between continuous cards and the rest of the cards is widening. Were these plastics 2.46% more expensive than conventional ones in 2021, in 2022 the difference will increase to 3.15%.
In this way it is verified that perpetual cards have not been unaffected by interest rate hikes and in 2022 have followed the upward path that had started in 2021, breaking the decline from 2020, which accelerated the Supreme’s verdict against WiZink. In concrete terms, the Supreme Court ruled against this entity on March 4 of that year, which reduced the interest in the market for these cards.
Source: La Verdad
I’m Ben Stock, a journalist and author at Today Times Live. I specialize in economic news and have been working in the news industry for over five years. My experience spans from local journalism to international business reporting. In my career I’ve had the opportunity to interview some of the world’s leading economists and financial experts, giving me an insight into global trends that is unique among journalists.
