{"id":37213,"date":"2018-09-01T09:21:17","date_gmt":"2018-09-01T14:21:17","guid":{"rendered":"http:\/\/olduvai.ca\/?p=37213"},"modified":"2018-09-01T09:21:17","modified_gmt":"2018-09-01T14:21:17","slug":"no-other-banks-are-this-exposed-to-turkey-argentina-brazil-emerging-markets-haunt-spanish-banks","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=37213","title":{"rendered":"No Other Banks Are This Exposed to Turkey, Argentina, Brazil\u2026. Emerging Markets Haunt Spanish Banks"},"content":{"rendered":"<header>\n<h3 class=\"entry-title\"><a href=\"https:\/\/wolfstreet.com\/2018\/08\/31\/turkey-argentina-brazil-other-emerging-markets-haunt-spanish-banks\/\">No Other Banks Are This Exposed to Turkey, Argentina, Brazil\u2026. Emerging Markets Haunt Spanish Banks<\/a><\/h3>\n<\/header>\n<div class=\"entry-content\">\n<p><strong>To diversify from the euro-debt-crisis, the biggest Spanish banks pushed deeply into Emerging Markets. Now, they\u2019re in a new crisis.\u00a0<\/strong><\/p>\n<p>Almost exactly six years ago, the Spanish government requested a \u20ac100 billion bailout from the Troika (ECB, European Commission and IMF) to rescue its bankrupt savings banks, which were then merged with much larger commercial banks. Over \u20ac40 billion of the credit line was used; much of it is still unpaid. Yet Spain\u2019s banking system could soon face a brand new crisis, this time not involving small or mid-sized savings banks but instead its alpha lenders, which are heavily exposed to emerging economies, from Argentina to Turkey and beyond.<\/p>\n<p>In the case of Turkey\u2019s financial system, Spanish banks had <a href=\"https:\/\/www.bis.org\/statistics\/b4-TR.pdf\">total exposure<\/a> of $82.3 billion in the first quarter of 2018, according to the Bank for International Settlements. That\u2019s more than the combined exposure of lenders from the next three most exposed economies, France, the USA, and the UK, which reached $75 billion in the same period.<\/p>\n<p>According to BIS statistics, Spanish banks\u2019 exposure to Turkey\u2019s economy almost quadrupled between 2015 and 2018, largely on the back of Spain\u2019s second largest bank BBVA\u2019s madcap purchase of roughly half of Turkey\u2019s third largest lender, Turkiye Garanti Bankasi. Since buying its first chunk of the bank from the Turkish group Dogus and General Electric in 2010, BBVA has lost over 75% of its investment under the combined influence of Garanti\u2019s plummeting shares and Turkey\u2019s plunging currency.<\/p>\n<p>But the biggest fear, as <a href=\"https:\/\/wolfstreet.com\/2018\/08\/10\/bbva-bnp-unicredit-european-banks-plunge-ecb-contagion-turkey-lira\/\">expressed<\/a> by the ECB on August 10, is that Turkish borrowers might not be hedged against the lira\u2019s weakness and begin to default en masse on foreign currency loans, which account for a staggering 40% of the Turkish banking sector\u2019s assets. If that happens, the banks most exposed to Turkish debt will be hit pretty hard.<\/p>\n<p>\u2026click on the above link to read the rest of the article\u2026<\/p>\n<p>&nbsp;<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>No Other Banks Are This Exposed to Turkey, Argentina, Brazil\u2026. Emerging Markets Haunt Spanish Banks To diversify from the euro-debt-crisis, the biggest Spanish banks pushed deeply into Emerging Markets. Now, they\u2019re in a new crisis.\u00a0 Almost exactly six years ago, the Spanish government requested a \u20ac100 billion bailout from the Troika (ECB, European Commission and [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[2251,63,90,5660,1732,743,818,4255],"class_list":["post-37213","post","type-post","status-publish","format-standard","hentry","category-economics","tag-argentina","tag-banks","tag-brazil","tag-don-quijones","tag-emerging-markets","tag-spain","tag-turkey","tag-wolfstreet"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/37213","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=37213"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/37213\/revisions"}],"predecessor-version":[{"id":37214,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/37213\/revisions\/37214"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=37213"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=37213"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=37213"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}