UK banks sitting on third-highest pile of bad loans in Europe as EU sees total of written-off debt soar to £1trillion
The number of bad loans in Europe has soared to £1trillion, according to PricewaterhouseCoopers, with UK banks still holding one of the biggest piles.
PwC said loans in default – or close to it – had more than doubled in just four years from £439billion in 2008, spurred by continuing woes in the southern European economies.
An £85billion increase in the past 12 months was largely down to higher levels of default in countries such as Italy, Greece, Spain and Ireland, the report said.
Bad loans: British banks held £140billion of non-performing loans last year, just below Spain on £142billion
But UK banks are still sitting on the third highest pile of bad loans, despite a return to economic growth. British lenders held £140billion of non-performing loans last year, just below Spain on £142billion.
Europe’s economic powerhouse Germany tops the pile with £153billion, but its banks are likely to have written far more loans given the sheer scale of its economy.
PwC partner Richard Thomson said: ‘There’s a lot of lending out there that is non-performing and there’s no rosy picture on the horizon.’
He said specialist lenders were buying bad loan portfolios from banks, but pointed out that £39billion in transactions over eight months this year was just a ‘pinprick’.
‘This is a long-term challenge – it’s a market we expect to be around for five to ten years.’
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Read more: http://www.dailymail.co.uk/money/news/article-2478763/UK-banks-sitting-highest-pile-bad-loans-Europe--
