Bad debt problems at Spanish banks and cajas, the regional S&L institutions, have triggered at least one skipped interest payment on a mortgage-backed bond this week and prompted warnings of imminent downgrades by credit rating agencies. Caja Madrid, Spain’s fourth biggest financial group, on Wednesday confirmed the cancellation of more than €1m ($1.4m) in interest owed to junior holders of MBS issued in 2006 and 2007 by special purpose vehicles. See FT Alphaville on Spanish banking pain.

This entry was posted by Gwen Robinson on Thursday, May 21st, 2009 at 4:50 and is filed under Capital markets. Tagged with caja madrid. Edit this entry.