(Bloomberg) -- Lenders in Spain have an exposure of about €20 billion ($21.8 billion) to the Valencia area that has been hit by deadly floods through mortgages to households and loans to local companies, according to the country’s central bank.
“The banks’ exposure is relatively high but it is not a systemic event, it will have an absorbable impact,” the Bank of Spain’s general director of financial stability, regulation and resolution Angel Estrada said Tuesday.
While the extent of actual losses remains unclear, the Bank of Spain said banks have lent about €13 billion including mortgages to some 150,000 private borrowers in the region and €7.2 billion has been given in credit to about 23,000 companies.
On Tuesday, Spanish Prime Minister Pedro Sanchez announced the first financial package for residents and companies in flood-hit areas in Valencia, and warned that the overall cost could rise to €10.6 billion.
Spanish lenders have announced donations to help victims of the floods and other measures including the removal of fees for ATMs used in the region. Meanwhile, the government today will declare the area as a catastrophe zone and approve urgent measures such as direct aid, postponement of some tax payments and labor protections.
The regional government hasn’t updated the death toll since Nov. 1 and the latest figure provided by the national government was 217.
(Updates with further details on flood relief. A previous version corrected source data on number of mortgage holders in third paragraph)
©2024 Bloomberg L.P.