Bad loans at Spanish lenders hit a record high in September

Julian Harris
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BAD loans at Spain’s banks struck a new high in September, it was revealed yesterday, as a wave of negative data releases poured more misery on the troubled euro area.

Figures from the Bank of Spain showed banks’ bad loans standing at 10.7 per cent of their outstanding portfolios in September – the highest level on record and up from 10.5 per cent a month earlier.

And in nearby Italy – another large Eurozone state under pressure from a debt crisis – industrial new orders collapsed by a seasonally adjusted four per cent.

Across the 17-country euro area as a whole, meanwhile, production in the construction sector sank by 1.4 per cent in September compared to the previous month – reflecting the recession that the bloc has fallen into this year.

Compared with a year earlier, production in the building sector was down 2.6 per cent in the Eurozone in September.

Yet markets shrugged off the data, rising on hopes for a deal to avoid a fiscal cliff in the US.