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Santander Offers $23 Billion Loans to SMEs Over Virus Risk

Santander Offers $20 Billion of Loans to SMEs at Risk From Virus

(Bloomberg) --

Banco Santander SA created a special 20 billion euro ($23 billion) line of credit for small- and medium-sized enterprises and self-employed people who may be affected by Spain’s measures to control the coronavirus.

The lender’s Spanish unit will be offering one-year, pre-approved loans to “help to mitigate the impact” that the containment measures may have on business operations, Santander said in a statement.

Spain, which has already moved to shutter schools for two weeks in the most affected areas, may increase its containment measures, making it more likely that small businesses will struggle to keep up payments on their loans.

Spain accounted for 37% of Santander’s outstanding performing loans to SMEs, commercial banking and institutions in 2019, according to the bank’s annual report. SMEs and companies make up 24% of the bank’s loan book while individuals account for 47%.

Last year, the bank invested 900 million euros in Tresmares Capital, a new platform designed to provide SMEs with alternative forms of financing.

While Santander has been cleaning up its balance sheet, Spain still had the highest non-performing loan ratio among the company’s 10 main markets last year at 6.94%. The bank had 280 billion euros of outstanding loans in 2019.

Cases of coronavirus in Spain almost tripled from Sunday to Tuesday to 1,622. As well as shuttering schools in Madrid and parts of the Basque country, Spain has banned flights to Italy and ordered all sporting events to be played behind closed doors.

In Italy,

To contact the reporter on this story: Charlie Devereux in Madrid at cdevereux3@bloomberg.net

To contact the editors responsible for this story: Dale Crofts at dcrofts@bloomberg.net, Ross Larsen

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