The consolidated result for fiscal year 2012 of Spanish banking groups recorded losses of \u20ac1.653 billion, representing a result \u20ac11.431 billion lower than that obtained in the previous year.<\/p>\n
These losses reflect the provisioning and restructuring effort undertaken by Spanish banking groups, which is unprecedented in the national and international financial system. The amount of provisions and allowances for loans and other assets was \u20ac15.104 billion higher than the already significant figure recorded in 2011, resulting in \u20ac42.703 billion in restructuring charges in the income statement for that year. <\/p>\n
These substantial restructuring charges were made possible by the strength of recurring margins in the income statement and were carried out while simultaneously strengthening the solvency of Spanish banking groups, whose core tier<\/em> 1 ratio stood above 10%.<\/p>\n After including the two entities acquired from FROB by respective banking groups, the consolidated balance sheet of Spanish banks stood at \u20ac2.4 trillion as of December 31, 2012, 4.9% higher than one year earlier, recording an increase of \u20ac114.848 billion at year-end. Regarding the composition of the balance sheet, the increase in fixed-income investment by 13.4% (\u20ac39.541 billion in absolute terms) stands out, compared to a decline in customer loans of \u20ac18.117 billion, net of provisions, representing a decrease of 1.3% year-on-year. <\/p>\n On the liability side of the consolidated balance sheet, customer deposits increased by \u20ac22.379 billion, 2% higher than the balance at the end of 2011. In net balances (liabilities minus assets), there was a substitution of funding obtained from other credit institutions with funding obtained from central banks of approximately \u20ac40 billion. <\/p>\n In line with developments in solvency ratios, the equity of banking groups increased by 6.6% over the last twelve months. It thus maintains, as it has been doing since the beginning of the crisis, a growth rate higher than that of the total balance sheet, specifically 1.7 percentage points above asset growth. The most significant aspect of this increase is that it is based on an increase in higher-quality equity, whether through organic generation or through the raising of new capital in the market, despite having to offset in equity the decline in attributable profit of \u20ac9.706 billion experienced in the past year. <\/p>\n As of December 2012, the consolidated non-performing loan ratio stood at 6.9%, representing an increase of 2.2 percentage points over the last twelve months. Meanwhile, the coverage ratio, driven by the aforementioned provisioning effort, rose to 69% of doubtful assets, twelve percentage points higher than that existing in December 2011. <\/p>\n It should be noted that the level of restructuring achieved in fiscal year 2012 was made possible by the strength of the most recurring margins in the income statement. This strength is reflected in increases in all margins in the upper part of the profit and loss statement compared to the previous year. <\/p>\n Net interest income increased by 4.1%, while gross margin increased by 3.2%, driven mainly by the strong performance of results from financial operations, which offset the weaker performance of dividend income, commissions, and other operating results.<\/p>\n The containment of operating expenses, achieved despite the incorporation of the two entities acquired from FROB, improved their weight on average total assets (ATA) by 4 basis points and placed the operating margin before provisions at \u20ac40.659 billion, 2.7% higher than that obtained in 2011. Furthermore, it maintained the efficiency ratio at levels of 47.9%. <\/p>\n The intense restructuring and provisioning effort that Spanish banking groups have been making in recent years has accelerated significantly as a result of the two royal decree-laws enacted during the past year.<\/p>\n Thus, the increase of \u20ac15.104 billion raises the restructuring figure to a total of \u20ac42.703 billion.<\/p>\n Once extraordinary results and the tax effect are taken into account, the consolidated result for the year shows losses of \u20ac1.653 billion, \u20ac11.431 billion less than those obtained in the previous year.<\/p>\n The aggregate of individual balance sheets experienced a moderate increase of 5% to reach \u20ac1.6 trillion. In its main variations, it presents features common to those of the consolidated balance sheet. Net funding obtained from central banks increased by \u20ac50.118 billion, which offsets the lower balance of \u20ac19.998 billion in resources taken from other credit institutions, as well as the decrease of \u20ac13.758 billion in the balance of securities issued. In the remaining liability items, we observe increases in customer deposits and equity of 1.4% and 4% year-on-year, respectively. <\/p>\n On the asset side of the individual balance sheet, there is, on the one hand, an increase in investment in fixed-income securities amounting to \u20ac34 billion, 18.2% more than the balance existing one year earlier, and on the other hand, a decrease of 2.9% in customer loans with a reduction, net of provisions, of \u20ac24 billion. The non-performing loan ratio stands at 10.08% with coverage of doubtful assets of 76%, 24 percentage points higher than that existing in December 2011. <\/p>\n In its most recurring part, the individual income statement shows great resilience and stability, reflected in increases of 10.3% in net interest income, 9.7% in gross margin, and 13.8% in net operating margin. These advances have contributed to placing the efficiency ratio at 42%, after a gain of 2.1 percentage points over the last twelve months. <\/p>\n It has been precisely the strength of these margins that has made it possible to nearly triple the provisioning and allowance effort, bringing it to \u20ac28.409 billion in a single year, compared to \u20ac10.226 billion in the previous year. This provisioning effort represents 1.79% of average total assets, compared to 0.7% in the previous year. <\/p>\n After recording gains and losses on sales and the restructuring of other assets, the result for the year, net of the tax effect, stood at losses of \u20ac5.462 billion in the aggregate of individual profit and loss statements, \u20ac9.803 billion lower than that obtained one year earlier.<\/p>\n The losses reflect an unprecedented restructuring effort: \u20ac42.703 billion in provisions and allowances for loans and other assets.<\/p>\n","protected":false},"featured_media":0,"parent":0,"template":"","etiquetas-prensa":[868,805,917,803],"class_list":["post-38614","notas-de-prensa","type-notas-de-prensa","status-publish","hentry","etiquetas-prensa-credit","etiquetas-prensa-results","etiquetas-prensa-solvency","etiquetas-prensa-spanish-banking"],"yoast_head":"\nDownload press release with results tables<\/a><\/h6>\n","protected":false},"excerpt":{"rendered":"