Spain

Spanish economy 28th August 2012

Morgan Stanley: Spanish bank restructuring legislation will improve competition

The draft RDL for bank restructuring and resolution is expected to be passed next Friday in Spain. Aimed at preventing new banking catastrophes, the new legislation gives the Bank of Spain and the state-backed Fund for Orderly Bank Restructuring (FROB) new powers to intervene before crises erupt. Morgan Stanley believes the new decree law will drive further consolidation in the sector, which together with extensive liability management at weaker entities,…

Spanish economy 28th August 2012

A full rescue may help Spain to bit the bullet

Now that full rescue seems an unavoidable option, overtly accepted by Madrid, the main opposition party in Spain has found some way to deliver a scathing attack on government. For all its dismal delivery while in power, it managed to avoid such unpalatable scenario. The current cabinet, supposedly better equipped to bring Spain out of trouble, has already being forced into a €100 billion banking salvage package and now it…

Spanish economy 27th August 2012

Spanish government keeps the upper hand on banks reform

The new set of rules on restructuring and liquidation of ailing banking institutions planned to be approved next Friday confers full command to the Spanish government. The Bank of Spain will exclusively identify solvency failures and pit in place an early warning mechanism to redress potential deviations. But once public money is involved the task is conferred to a formally independent body, the FROB, but under tight governmental control. Politicians…

In Europe 24th August 2012

“Europeans are not productive enough to defend their living standards”

Famous for his provocative views on international economics and China’s rise, Andy Xie is an independent economist who predicted the Asian bubble in 1997. Based in Shanghai, he is a former Morgan Stanley star chief Asia-Pacific analyst. We interviewed him for our summer interviews on China’s challenges, the eurodrama and his forecast for the future. For Mr. Xie, Wall Street bankers are viewed in China as “a bunch of corrupt…

Spanish economy 23rd August 2012

Buy more brick for a worst price

CAPITAL MADRID, José Sánchez Mendoza.– Pay more, almost double, but with a comfortable loan that covers all or most of the amount. It’s a win-win situation, don’t you think? Though it may seem, this is not the lamp seller in a Moroccan bazaar’s talking but the candy that banks put in front of consumers to get rid of the housing stock that hampers their balance sheets. According to a study…

Companies 21st August 2012

City National Bank of Florida, Bankia’s green shoot in the US

FLORIDA | with informations from Brian Bandell | City National Bank of Florida reported improved earnings in the second quarter of the year as it announced plans for four new branches. The Miami-based bank earned $10.3 million in the second quarter, up from $9.4 million in the first quarter. Its net interest income grew to $30.6 million in the second quarter from $30.2 million. Still, figures are 8.8 percent lower than last year in the same…

In Europe 20th August 2012

I call Angela Merkel’s bluff

By Luis Arroyo, in Madrid | German Chancellor Angela Merkel the executioner recently said that austerity is the right path, and that Canada should provide a good enough example for non-believers. Should we have a closer look into her claims?, of course we must. Unfortunately for her, it clearly appears to be the case that Canada’s success has been supported by a monetary policy absolutely at odds with the European Central…

Spanish economy 20th August 2012

“Contraction and austerity combined are an extremely dangerous mix for Spain”

Morning! Today we bring you the last part of our summer series interview with Professor of Economics at Columbia University Martin Uribe. He believes that the Eurozone needs structural changes to tackle the crisis, especially in fiscal matters. The lesson we should learn from this crisis is to avoid high capital inflows into a country as happened to Spain from 2000 to 2008. – Several Nobel laureates have decried budget…

Spanish economy 16th August 2012

As housing prices keep on going down, the end of the crisis in Spain is nearer

By Tania Suárez, in Madrid | In Spain, the fall in the housing prices is intensifying and that is a reason to rejoice. Last July, the average housing price fell 11.2%, but the granting of mortgages went down by 21% in the first half of the year. It is obvious that the owners may not feel comfortable with these decreases, but the truth is that as housing prices keep on…

Companies 15th August 2012

Bish, bash, bosh: the latest from Bankia

MADRID | Bankia shares seem to have become a toy amid high volatility on the Madrid stock market index Ibex35. This week so far the entity suffered a -16.08 percent loss of price in two consecutive sessions, after the State fund for banking restructuring FROB announced that stockholders will be partially shouldering, too, the costs of the rescue of the bank with taxpayer money. Banco de Valencia stock fell by -23.8…

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