Prisa investors take one for the team 7 Oct 2011 The Spanish media group’s core shareholders have injected 150 million euros of capital after exercising warrants at a loss. Even this act of charity doesn’t solve Prisa’s debt problem. But it might sway Prisa’s lenders to be more flexible on the repayment of 3.2 bln euros of borrowings.
IMF bond-buying a potential euro game-changer 5 Oct 2011 The International Monetary Fund says it might buy sovereign bonds to help the euro zone fight the contagion effects of the Greek crisis on Italy and Spain. This could work if both countries continue to reform, and once the region’s weaker banks have been shored up.
Spain’s biggest IPO runs out of luck 29 Sep 2011 The 7 bln euro Loterias IPO has been abruptly pulled. Market conditions were tough, but political pressure and liquidity-starved banks may have dealt decisive blows. Though the cancellation will have a modest impact on state finances, it will reverberate. And it is shambolic.
Spain should not rush savings bank sales 27 Sep 2011 The country’s bank rescue fund is preparing to offload a bust lender with the help of generous guarantees. But a deal would transfer any upside to buyers, while leaving the state on the hook for most future losses. With more bank nationalisations to come, Spain should hold on.
Spain could cut costs by cutting lunch 23 Sep 2011 Competitiveness is one of the Spanish economy’s main problems. Cutting down on the long workday could boost productivity and reduce energy bills. A shorter lunch would be a good first step.
Repsol is wrong to get heavy with activists 16 Sep 2011 The Spanish oil giant is angry at a new shareholder pact between construction firm Sacyr and Mexican energy group Pemex. The activists’ interests may conflict with those of other shareholders. But their immediate demands make some sense, and a big battle benefits no one.
Spain’s giant lotto IPO pushes its luck 13 Sep 2011 The part privatisation of Spain’s lottery couldn’t be more different to recent savings bank flotations. It’s defensive and throws off cash. But Madrid is hoping to see a jackpot of up to 7.5 bln euros. Even with so much in its favour, the deal will be lucky to raise that much.
Interest in Spanish airports sale is deceptive 9 Sep 2011 The $7.5 bln privatisation of Madrid and Barcelona airports has attracted considerable attention. Six groups are lining up to bid for each. But the timetable is tight, the concessions short, and the prices steep. An auction will struggle to get off the ground.
How to get Spain working again 2 Sep 2011 With elections looming, political parties must come up with sensible solutions to tackle a 21 percent unemployment rate. Cutting social security contributions makes sense, but it’s harder than it looks.
No easy fix for Spain’s housing market 22 Aug 2011 The government hopes to jump start the housing market by temporarily cutting the VAT rate on purchases as part of a package to shrink the country’s deficit. The move might help a bit. But buyers won’t return until job creation resumes, and banks recognise more property losses.
Spain must seize the moment for more austerity 18 Aug 2011 The markets’ focus has been on Italy and France. Emergency ECB buying of Spanish bonds has helped bring down yields. Spain may not have crippling debt, but it’s plagued by low growth and a high deficit. Fresh austerity measures due this week need to be comprehensive and credible.
Split EU regulators weakened by dubious short ban 12 Aug 2011 Without the cover of European unanimity, countries that imposed short-selling curbs have made it look like they have something real to worry about. Bank shares are still gyrating - hardly evidence of a more stable market. Watchdogs risk suffering a hit to credibility.
ECB’s bazooka has a limited shelf life 8 Aug 2011 The central bank’s decision to buy Italian and Spanish bonds has calmed investors’ nerves. But the ECB is only buying time until the euro zone governments’ bailout facility is ready to step in. And the repercussions of Friday’s U.S. ratings downgrade could limit future rescues.
Italy overtakes Spain as euro zone’s main worry 2 Aug 2011 Yields on Italian bonds are soaring as the political vacuum fuels fears the government won’t be able to implement its fiscal plans. Spain is suffering too. But Madrid is tackling its problems, while Rome is stalling. Given the sheer size of Italy’s debt, that’s a major concern.
Rajoy needs to tell Spain some home truths 1 Aug 2011 The country’s probable next PM shouldn’t wait until after November’s election to level with the Spanish people about the actions needed to avoid getting sucked into the euro zone crisis and to restore competitiveness. Here’s the speech he should give now.