Aurelio Medel (5 Días) | The fall in indebtedness of companies and families can be interpreted as proof of the improvement of their financial health, also as further evidence of the low investment made in Spain, or as a warning that the restructuring of the financial sector will continue. The decline in credit activity adds to a context of a permanent increase in capital requirements, which have placed the sector…
Caixabank Research | Households and corporate debt levels (including debt securities) remain below euro area averages in 4Q23. Both sectors have deleveraged in terms of GDP, reaching levels lowee than pre-pandemic ones. New mortgage production recovers in early 2024 with the change in interest rate expectations. New lending for consumption increases favored by improvements in consumer confidence, and credit for consumer durables, exceeding pre-COVID-19 levels. New lending to corporates grows…
Bankinter | The European Commission (EC) has authorised the entry of Vauban Infrastructure Partners and Crédit Agricole in Telefónica’s rural fibre optic affiliate. The company, called Bluevia, will have the 3.5 million premises which has the group’s fibre optic and will roll out an additional 1.5 million fibre optic connections in the next two years. Bluevia will also signs provision of services contracts with Telefónica. The consortium formed by Vauban and CA…
Moody’s points out that Spanish public debt is at maximum levels for a century. Thus, it will take into account in its next rating reviews whether the Spanish government presents a credible plan to reverse the fiscal deterioration aggravated by Covid-19. A downgrade of the current rating (Baa1 with a stable outlook) could lead to the downgrade of more than 50% of Spain’s companies’ in 18 months. Even so, this warning is not exclusive to Spain (public debt/GDP 120%), as there are other countries with high debt problems (Italy 158%, Greece 200%, Portugal 137%).
The Recovery Fund exceeds the Merkel/Macron proposals with an amount of €750 billion euros (equivalent to 5.4% of the EU27’s annual GDP). Italy and Spain would be the countries to most benefit. This was something that was quickly reflected in the performance of peripheral credit on Wednesday, especially in the financial sector, with improvements on average of about 10bp in the CDS of banks in both countries. For its part, France and Germany will receive transfers of 39 Bn and 29 Bn, respectively.
The current scenario forces stimuli and, at last, the Eurogroup is beginning to propose some important measures such as the agreement to promote fiscal measures throughout the Eurozone worth 1% of GDP in 2020, or guarantee schemes and tax deferral equivalent to 10% of GDP. Furthermore, Spain’s Prime Minister, Pedro Sanchez, announced a much more ambitious plan, mobilising up to 200 Bn euros, of which 83 Bn euros will be private, mainly from banks. The shock plan is equivalent to 20% of the national wealth (11.7% taking into account the State’s share).
Yu Hairong, Wu Hongyuran, Huo Kan, Cheng Siwei and Han Wei (Caixin) | Where is the Chinese economy heading and how will policymakers react? As the new year approaches, debate over the outlook of the world’s second-largest economy is heating up, and all eyes are searching for clues to the next policy steps.
Bankinter | The private sectors credit stock increases +3.4% in April (vs +3.2% before). A strong performance in company credit stands out (+3.9% vs 3.6% before) as well as credit for buying houses (+3.6% vs +3.5% before).
J. L.M.Campuzano | Spanish household debt continued to reduce in 2017, reaching 61% of GDP (down 3%), according to the Bank of Spain. It has fallen 24% since its máximum level reached in 2010. Company debt at the end of the year amounted to 78% of GDP, with a fall of 5% over 2016. Company debt has fallen 39% since its maximums.
J. L. M. Campuzano (Spanish Banking Association) |What is the main concern for Spain’s SMEs? The lack of clients. This is what they have revealed in the latest survey published by the ECB, covering the period from October 2016 to March 2017. And what about financing? It was once again the least of its worries, something which has been the case since the start of the year.