European Banks Hold 1.3 Trillion Bad Loans

Around 1.2 trillion euros ($1.7 trillion) of non-performing loans (NPLs) are parked on European banks’ balance sheets, underscoring the ongoing malaise in peripheral European nations.
Despite investor optimism and upbeat growth data suggesting that Europe is en route to economic recovery, banks’ holdings of NPLs — defined by the European Central Bank (ECB) as loans on which no repayments have been made in the last 90 days — have increased by nearly 100 billion euros over the last year, according to professional services firm PwC. At the end of 2012, banks held 1.19 trillion euros in bad loans, up on 1.09 trillion euros in 2011.

The rise in NPLs has been driven largely by countries in struggling Southern Europe — mainly Italy, Spain and Greece — and Ireland.

via CNBC/a>

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza