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German Banks Have Most Bad Debt On Books

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German banks top Europe bad loan table
13:05, Monday 28 June 2010
FRANKFURT (Reuters) - German banks have more bad loans on their books than rivals in other European countries, a study by auditors PriceWaterhouseCoopers said, as the secondary market for non-performing loans (NPLs) there is still immature. At the end of 2009, German banks carried NPLs with a nominal value of 213 billion euros (174 billion pounds) on their balance sheets, 50 percent more than a year earlier, PwC said on Monday.
British banks had NPL worth 155 billion euros, compared with 107 billion a year earlier, while Spanish banks were at 96.8 billion from 75.4 billion and Italian banks had 59 billion of bad loans compared with 42 billion last year.
"Despite the Europe-wide growth (of NPL) the (German) market for NPL has not yet gathered momentum," PwC's Jens Roennberg said.
In Britain, NPL worth 1.6 billion euros have been sold since the beginning of 2010, PwC said, adding German banks benefited from state bail-outs which allowed them to keep Tier 1 ratios at required levels and take their time on asset sales.
"We expect that several credit portfolios will come on the market in the second half of the year," Roennberg said.
(Reporting by Adolf Goering; editing by Herman Hitler)

We shall no doubt be told this is a sign of strength as bad debt is really just debt about to turn good once it has been disappeared into an innovative investment product.

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