The Spanish banks always looked vulnerable to me. I have criticised Santander several times on this blog.
But this story deserves more coverage. Ibex Salad – a blog about the Spanish stock market and olive oil business – is reporting that banks are taking the property they are repossessing from bankrupt property developers and selling it to their own staff at a 35 percent discount and with 100% percent financing.
This is called loss deferral. That is what distressed banks do.
But Ibex Salad makes the obvious point. For employees this has one side benefit – staff who borrow from the bank are more likely to keep their job. Probably a good deal for the bank staff – even if they are paying slightly over the odds.