Moody's highlights rising arrears assets backing mortgage bonds

The risk measurement agency Moody's notes that during the second quarter increased delinquencies of assets backing the Spanish mortgage bonds, due to rising unemployment.

In a note, Moody's notes that mortgage defaults after 60 days have passed presumably 1.5% of the portfolio of all the bonds-securities guaranteed by mortgage loans granted by the CA, in June 2008 to 2.8% in the same month this year.

Meanwhile, defaults accounted for 90 days after the close of the second quarter by 1.9% compared to 0.7% from a year earlier.

"Rising unemployment and low employment are affecting the mortgage, which is directly reflected in the delinquency rate," the agency reported.

Furthermore, he notes, housing prices continue to fall in Spain, which will continue down the value of the mortgaged property.