Spanish banks' bad loans increased to 8.95 percent of total lending in May, the Bank of Spain reported Wednesday. The bad-loan ratio rose from 8.7 percent in April.
Bad loans rose to EUR 155.84 billion in May, the highest since April 1994.
The property market crash as well as Spain's record high unemployment rate in the euro area raised banks' bad loans.
With the recession now expected to last throughout 2012 and 2013, the bad bank loan ratio is likely to remain on an upward trajectory, and could breach 10 percent by the second half of 2013, IHS Global Insight economist Raj Badiani said in a note.
Eurozone finance ministers are likely to meet on July 20 to finalize the EUR 100 billion Spanish bank bailout deal struck last month.
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June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.