Spain Banks Ditch Debt in Pre-Stress Test Makeover: Euro Credit
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Spanish lenders have sold lucrative government bond holdings ahead of European Central Bank stress tests, forcing them to think of ways to restore lost revenue.
Banco Popular Espanol SA, a lender that had to raise capital after Spain’s stress tests in 2012, reduced its sovereign debt holdings by 5.6 billion euros ($7.6 billion), or 44 percent, in the fourth quarter. Bankinter SA sold about half its holdings because of uncertainty over how they’ll be treated in the exercise the ECB is planning in its new regulatory role.