The bank will have sold more than 150,000 million toxic assets by the end of the year

Following recommendations from the European Central Bank, Spanish banks accelerated the sale of large property portfolios to reduce non-performing assets inherited from the financial crisis. Between 2014 and 2018, institutions disposed of almost €102 billion in assets, primarily through transactions with large real estate investment funds.

ECB data indicated that Spain’s financial system still held €106.22 billion in crisis-related assets at the end of 2017.

Major banking transactions

After CaixaBank agreed to sell its real estate business to Lone Star, major transactions involving Sabadell and Sareb remained pending in 2018. Sabadell was considering the disposal of €10.9 billion in non-performing assets.

Santander had previously launched one of the largest transactions by transferring approximately €30 billion in assets to a joint venture with Blackstone. BBVA subsequently agreed to transfer €13 billion in real estate assets to Cerberus.

According to figures attributed to Deloitte, the largest sellers of banking assets in 2017 were:

• Santander: €30.5 billion
• BBVA: €13.2 billion
• CaixaBank: €2 billion
• Sabadell: €1.3 billion
• Bankia: €1.1 billion

International investment funds

The principal buyers were opportunistic investment funds seeking large portfolios of distressed loans and real estate. The most active buyers identified for 2017 were:

• Blackstone: €30.7 billion
• Cerberus: €13 billion
• Bain Capital: €1.3 billion
• Lindorff: €1.2 billion
• Deutsche Bank: €1.1 billion

Based on the pace of these transactions, cumulative disposals of distressed banking assets were expected to exceed €150 billion by the end of 2018.