I think this is where it will all unravel. The assets that the loans were secured against have themselves plummeted in value. I think the bottom line is a large proportion of these loans will NEVER be repaid and the tax payer picks up the pieces.
The developer may have purchased something for €100 million. €10 million of his own money and €90 million of the banks. The bank looked for security on this loan and he may have put up other land 'worth' €90 million as security.
house of cards !