The Bank of Spain says the bad loan ratio of Spanish banks hit a new record high of 10.7 percent in September. The bank said on Monday that more than one in ten loans, mostly real estate credits, are classified as high risk, meaning the loans will probably not be repaid. In September, the total value of all the high-risk loans was 182.2 billion euros (about $233 billion), the bank added. The figures of high-risk loans were lower in August at a level of 10.52 percent. In a country where one in four is currently unemployed, an escalation of evictions is resulted from people not being able to pay their mortgages. The Spanish government declared a stop to evictions of the most desperate homeowners, after three suicides in one month were linked to people losing their homes due to financial troubles. A report released by top magistrates in October said around 350,000 evictions occurred from 2008 to 2011. In the first quarter of this year, 50,000 were reportedly evicted from their homes.
The Spanish government has also been sharply criticized over the austerity policies that are hitting the middle and working classes the hardest.On November 14, a general strike was staged and labor union members held a sit-in in Madrid, which led to clashes with police. Over 140 people were arrested and more than 70 others injured. However, the government has remained adamant saying the austerity measures are needed to bring it through the crisis. The worsening debt crisis has forced the EU governments to adopt harsh austerity measures and tough economic reforms, which have triggered incidents of social unrest and massive protests in many European countries. CAH/HSN