This might have been a profitable way out of the problem in the last recession, but this time around the scale is much greater. The banks might end up owning a large proportion of the output of the developers or supporting those developers with zombie loans.
This is something else that seems quite interesting, zombie loans.
In the original links supplied by brianc_li the report made mention of japanese banks and zombie loans during the last recession.
But as far as I understand are not japanese banks in a strong position during this recession, to the point of buying up quite a few foreign assets?
I this is correct (please correct me if not) then it does not necessarily seem to mean the downfall of the spanish banks.