After the Euro crisis as well as near depression in its home market of Spain, the Basque bank BBVA decided to look abroad. It seemed to make sense in a world of QE amid massive inflows into emerging markets. That has now changed given the reversal in hot money away from those markets and the specific problems of Erdogan’s Turkey (next to war-torn Syria)… and the rise of the US dollar (and a global ratcheting up of interest rates).
Don Quijones writes a worrying article on BBVA and suggests that the European Central Bank has put BBVA and Santander on a watchlist. If true, then the Spanish banking system is heading back to 2011 given that these two banks are regarded as the strongest in the peninsula …….
“After the euro debt crisis, Spain’s alpha-lender sought greener pastures in the Emerging Markets. That bet is coming home to roost.” ……..referring to BBVA…..”
The article can be found at the link below:
Core 