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In Europe 16th May 2014

Spanish banks mitigate reliance on ECB

MADRID | By Fernando G. Urbaneja | In the midst of the financial turmoil (2012), the ECB facilitated liquidity to avoid the collapse of the European banks when the inter banking market was dried up and nobody lent money. The central bank had to act as “last resort banker” and maintain the system as well as guarantee liquidity. Those credit lines are amortized once their function has been accomplished. Now, they are preparing other measures to stimulate growth and avoid other threats such as deflation or stagnation.

imf projections for spain s gdp growth chartbuilder copia

In Europe 13th May 2014

Spanish recovery glass only half-full

BARCELONA | Joan Tapia| That the Spanish economy grew by 0.4% quarterly in the 1Q14, and by 0.6% yearly is a real green shoot. After several years of recession, GDP is to grow moderately, around 1% in year 2014. However, employment continued falling by 184,000 people, at an annual pace of 0.5%. A slap in the face for those who told the recovery was more intense than expected.

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In Europe 7th May 2014

Brussels demands more austerity to Spain to meet deficit target, praises banks’ reform

MADRID | By The Corner | In its first surveillance report after the Spanish banking sector bailout, the EC believes that entities are stronger and cleaner. Even if NPLs ratio has not stabilized, banks “are shifting towards more stable funding, such as deposits, and are relying less on borrowing from the Eurosystem.” As market access conditions have greatly improved, Brussels Spain’s return to positive economic growth (using February data, when growth estimates for 2014 were 1% instead of 1.1%) and was positive about the labour market slight improvement, although it warned that jobless rate remains very high (26% 2Q13). Brussels considers that unless further austerity measures are adopted the crisis-battered country won’t meet its deficit goals.

Europa del sur

In Europe 6th May 2014

Can Spain become EU’s periphery locomotive?

MADRID | By Julia Pastor | Spanish PM Mariano Rajoy started campaigning for the upcoming European elections on Tuesday. In a radio interview he announced that the country’s unemployment rate has started reversing since job destruction is slowering. The fall of the country’s risk premium and 10-year bonds yields are crucial for companies financing abroad, he recalled. Even though Brussels forecasts are just estimates, they do support the idea that Spain could become the driver of peripheral EU with a growth over Italy, Portugal and even France.

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In Europe 29th April 2014

A British flavor for Spanish olive oil firm Deoleo

MADRID | By The Corner | Spain’s production of so-called gold liquid made Spanish company Deoleo olive oil’s world leader. After a sound restructuring, British private equity firm CVC bought a major stake of 29.99%. Just three stakeholders Unicaja (11.35 %), Kutxabank (4.8 %) and Caixabank will guarantee the ‘Spanishness’ of Deoleo. Better than an Italian entering into the company’s capital, which was also considered.

 

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Markets 29th April 2014

Market chatter: Spain gloomy jobless rate, Santander 1Q results and much more

MADRID | By Jaime Santisteban | Spain’s unemployment rate climbed to nearly 26 per cent in 1Q, official data showed Tuesday, despite the positive growth figures the government is proudly showing. Markets are weighing the effects of those numbers on the country’s sluggish recovery, the same day Spanish bank Santander announced an 8% profit increase in 1Q. Spain only accounts for 14% of the entity’s profits, while the UK is already 20%. 

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In Europe 29th April 2014

EU elections: Selling good news

MADRID | J.P. Marín Arrese | The EU seems an endless discussion on futile issues taking place in Brussels. We are all too aware that real decision-making lies in Berlin.

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In Europe 23rd April 2014

The juicy business of speculating with Spanish sovereign debt

MADRID | By Julia Pastor | Speculators who dared to buy Spanish debt in 2012 when it yielded 7.5% and priced a record low of 88.6% made a good deal with gains of 38%, now that Spain’s 10-years bonds’ interests near 3% and price stands at 122.6%. Moody’s thinks the country’s sovereign debt is going upwards, alongside Ireland, thanks to its economic, institutional and fiscal strengh. However, Italy’s rating is suffering from the opposite trend.

Rescate banca

In Europe 21st April 2014

Healthy Spanish banks still have to pay €7.5bn for their peers

MADRID | By Julia Pastor | In the Spanish banks restructuring process, the €100 bn credit line coming from Brussels was crucial. However, Spain’s financial sector also saved itself by transferring €7.5 bn from the banks in better conditions to those that were nationalized, basically via contributions to the Deposit Guarantee Fund and the national bad bank Sareb. [Picture: “Banks should pay for the crisis”]