Spanish banks got a much needed boost on Friday, as a couple of lenders posted better than expected results. Leading the pack was Caixabank, the country’s third largest bank, which posted an increase in net profit, to smash analysts’ expectations. The bank’s third-quarter net profit was €332 million, which was a 15 percent increase year-on-year. According to a Reuters poll, analysts were expecting a 7 percent decline. Shares in the company were up 0.5 percent. Spanish banks, as well as other banks in Europe, have struggled with the ultra-low interest rates, which have kept lending income at worryingly low levels. Caixabank has made improvements to its bad loans, as did Sabadell. Spain’s fifth largest bank saw year-on-year profits drop by 3 percent, though it came in much higher than analysts’ expectations, and 27 percent higher than the previous quarter. Not all banks were as fortunate.
Banco Popular, which is the bank that was worst-hit by the real estate mishaps, had another report of ‘barely there’ profits. The bank’s profit for the period was €416,000, which was marginally above forecasts. This didn’t stop the bank’s shares from being pummelled in the stock market however, as it tumbled 7.4 percent. Popular, the sixth largest lender in Spain, angered investors by not revealing the state of its bad loans. CEO Pedro Larena and his executives were given an opportunity by reporters to address the issue, but they declined. The bank has lost 60 percent in its share price over the last year. Despite Sabadell’s improved earnings, the bank’s shares were down nearly 5 percent, due to weak lending reports from its British subsidiary, TSB.