2023-06-29 00:21:38
The Management Company for Assets Arising from Bank Restructuring (Sareb) closed last year with losses of 1,506 million euros. Some red numbers that, despite being slightly reduced compared to 2021, show the difficulties of the so-called ‘bad bank’ to manage all its assets. Real estate and developer credit that in 2012, with its birth, absorbed from the balance sheets of the rescued entities.
More than a decade after its creation, it can be affirmed that the bill for public accounts has been capital. And everything indicates that this year it will be difficult to reverse the negative impact that Sareb has on debt and the public deficit, after Eurostat forced the State to assume these figures for accounting purposes in March 2021, shooting the first at almost 35,000 million euros and the deficit in more than 10,500 million.
«The company’s losses are not a surprise, but something necessary and inevitable. The more we sell, the more loss we have, but the objective is to sell to pay off the debt, ”they defend from society. They do so under the pressure of a date marked in red on their calendar: November 2027, when Sareb will cease to exist in principle, although the Government may decide to extend its life beyond that if it deems it appropriate.
Until then, the goal is to sell as much as possible, in order to generate income that lessens the burden on taxpayers. But the problem is the enormous latent losses in these operations, with a good part of its portfolio acquired at a price much higher than the current one. A setback that is now being aggravated by the current environment of rising interest rates, which notably affect the deterioration in the valuation of these assets.
Specifically, this impairment in the book value of its assets has risen by almost 3,000 million euros compared to 2021, to account for a total of 11,622 million euros, which marks the difference between the initial accounting of the assets and their sale price. sale.
Company sources indicate that this bulky figure comes after an “effort” to accept the valuation at transactional prices. And they insist that the rate hike environment has been key at this point, representing almost a third of the adjustment despite the scenario of a rising real estate market. “Appraisals also have an influence, which we must update and have been renewed downwards,” they indicate.
The impact of the soil
As part of the calculation, Sareb has also carried out an exercise to project future values, which points to a moderation in market prices that also affects, especially in the land portfolio, where no revaluation forecast has been projected. “There are lands that in Sareb’s life horizon will have little capacity to generate value,” they acknowledge. Currently, its portfolio in this segment amounts to
With own funds also in negative, net worth also presents red numbers of 14,172 million euros, from 9,934 million the previous year. Sareb sources clarify that this difference of around 4,000 million does not imply that this is going to be the figure that the company adds to the public deficit, and they estimate that it will be “much less”. But it will continue to impact. And also in public debt.
At this point, the company defends that “we had a problem of more than 50,000 million – in reference to the debt guaranteed by the State at the beginning – and now we have a problem of 31,000”. The reduction in these years has been notable. But the truth is that, despite the notable effort of the management team, the current debt is greater than the 20.3 billion that have been canceled in recent years. “How much we can amortize more, I don’t know, but we are absolutely committed to it,” they indicate from the company. Already last year, some 3,183 million euros were cancelled, the largest amortization in one year.
Sareb still has 217,285 units in its portfolio. Selling them at the best possible price is key to reducing their impact on public accounts. And, with the data on the table and the current market environment, it seems difficult to reach 2027 with the aim of minimizing losses for the State as much as possible.
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