The capital requirements of each institution have now been published, but non-performing loans continue to increase sharply. Nevertheless, CaixaBank analysts indicate, the fall in deposits of firms and households is partly due to issuances of commercial paper with more attractive, higher returns.
“To avoid the euro zone spinning out of control, conditions imposed on Spain should be tailored to be fairly met. That inevitably involves further flexibility in its deficit goals,” says economist JP Marín Arrese.
MADRID | “Given that it took four years to complete the negotiations of the Treaty of the Union until it was signed in 1992, given the depth of the issues, it is conceivable that this time it won’t be a lot simpler,” says Carlos Díaz Güell.
BARCELONA | Europe’s political agenda intensifies, analysts at CaixaBank. But the dynamism of the foreign sector is not enough to offset the fragility in domestic demand.
MADRID | As France pushed for in the last euro summit, the EU-wide banking supervisor would be set up by 2013. But its work will not begin until after Germany’s elections in the second half of the next year, and direct bank recapitalisation is out of the table, again. Ms Merkel was the real winner.
The European Stability Mechanism, the euro bailout fund, was designed to avoid a rapidly approaching doomsday scenario. But Germany’s tendency to backtrack in the last moment will only scare investors even more. Market pressure on Madrid is mounting again.
Luis Martí, former World Bank director, briefs us about the map of a no-one’s land where the Spanish government seems to be wandering in search of Brussels help to face its financial needs.
It will not look good for the political party in office in Madrid, analyst at Self Bank Victoria Torre told Julia Pastor, but requiring a rescue is only a matter of when. And the Spanish government wouldn’t be the only one to blame.
What exactly is Germany doing? It may succeed in shying away from the rescue bill now but it risks loosing the euro area market. Economist JP Marín Arrese warns the collapse of the common currency is not far from becoming a very real threat.
Why the German government believes it should force Spain into a national rescue like Greece, Ireland and Portugal did before is a puzzling question for Madrid. The markets are not quite sure, either.