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Berkowitz Buys Distressed Spanish and Portuguese Commercial Paper

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The Santander debt matures between January and March with yields ranging from 0.934 percent to 1.005 percent, according to the fund’s annual report, which was filed with the U.S. Securities and Exchange Commission on Feb. 1. Fairholme bought about $599 million of the debt from Spain’s largest bank between May 30 and Aug. 31 and then added to its holdings during the next three months, the filing shows.


The fund’s commercial paper from Espirito Santo, Portugal’s largest privately owned bank, matures in January and February and yields as much as 1.355 percent, according to the annual report. Fairholme bought the securities between Sept. 1 and Nov. 30, according to the filing.

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I was just reading Santander reports and it looks very hard to kill with only 16% of their assets in Spain/Portugal.


Just their Latin American banks (like 40% of the assets and all with 20%+ ROE) are worth more than the $100B market cap. 1x BV and 4x PTPP earnings with good capital ratios and declining NPLs looks tempting.

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