Mortgage lending tumbled in Spain in February, with the number of home loans sinking 47.1% on an annual basis, and the capital loaned on homes dropping 54.8%, the National Statistics Office said yesterday. Meanwhile, the total capital loaned in the month plunged roughly 50%. In the month of February, the number of home loans fell 9.4% and total capital loaned dropped 15.4%. Spain's economy is in the grips of an intense downturn, driven by the 2008 collapse in the property market. Ioan Smith, director of Knight Capital Europe Ltd., said in a note to investorsthat there are currently 80 billion euros of doubtful loans to real estate and construction, owing to a 20% fall in real estate prices. “If a further 35% decrease is still to come, things could get a lot worse,” he said.

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