MADRID, April 21 Spanish banks' bad debts as a percentage of total loans dipped slightly to 13.4 percent in February compared with 13.5 percent in December as both bad loans and total lending dropped.
Total credit in the financial system was 1.453 billion euros ($2 billion) in February, down from 1.458 billion a month earlier, data from the Bank of Spain released on Monday showed.
Bad loans dropped to 195 million euros from 197 million euros a month earlier, after hitting a record high in December.
Spanish banks, crippled with sour assets after a prolonged property bubble burst in 2008, mostly forecast that bad loans will peak this year as the country pulls out of recession and lending picks up again. ($1 = 0.7228 Euros) (Reporting by Fiona Ortiz; editing by Sarah Morris)