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Spanish Business News

The latest business, economic,property, stock market and financial news from Spain. Keep up to date with what is happening with the Spanish economy, stock market, the economic crisis, the euro zone debt sovereign debt crisis and the Spanish property market.

Further collapse in Spanish retail sales - down 10.9% Year on Year
30 October 2012

Anyone with half a brain cell could see that putting up VAT in the middle of an economic depression was madness and that it would lead to less VAT being collected and a collapse in retail sales.  Yesterday's figures confirm this and show that Retail sales were down by 10.9% on a year on year basis, due to the VAT increases.

From Reuters:

Spanish retail sales fell 10.9 percent year-on-year on a calendar-adjusted basis in September, official data showed on Monday, after a revised fall of 2 percent in August and following an increase in sales taxes from Sept. 1.

The data from the National Statistics Institute marked the 27th month in a row of falling retail sales data.

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Corvera Test Flights Prove Successful
28 October 2012

Following the recent final test flights at Corvera airport, as previously reported in The Leader, the Spanish airport authority has confirmed a favourable outcome to the test flights, confirming a clear path to the final stage of approval before the airport is clear for operations.

In a press release, the airport developer explains that the arrival, departure and approach procedures will now be presented to the Interministerial Committee of Defense and Public Works for approval. 

Source: The Leader

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Santander urges Spain to seek bailout as profit plunges
26 October 2012

(Reuters) - Santander, Spain's biggest bank, urged the government to seek an international bailout to reduce borrowing costs for struggling lenders, as writedowns on bad property investments almost wiped out its third-quarter profit.

Santander, the euro zone's largest bank by market capitalisation, has weathered Spain's property market crash and sovereign debt crisis better than rivals because it makes less than a fifth of its profit in the country after years of expansion abroad into regions like Latin America.

However, its shares and funding costs have suffered as Spain, after agreeing a credit line from the European Union worth up to 100 billion euros ($130 billion) to rescue its banks, drags its feet on requesting a full bailout.

Source: Reuters

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Spain jobs woes deepen as unemployment rate hits 25pc
26 October 2012

Spain’s unemployment rate reached 25pc, official data showed of Friday, the highest level since the nation’s transition to democracy, with further layoffs predicted next year.

Tens of thousands of jobs were lost between July and September raising the number of unemployed to 5.78 million people, Spain’s National Statistics Institute reported, a level unseen since the dictatorship of Francisco Franco ended in the mid-1970s.

The number of Spanish households in which every member is out of work climbed to 1.74 million, roughly one tenth of all Spanish families.

The rise in the number of jobless comes as Spain sinks deeper into recession, with output expected to decline for the third consecutive quarter.

It comes as Spain struggles with deep austerity measures that have forced many out onto the street in protest.

Source: The Telegraph

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Spain’s $117 Billion Bad Bank Seen as Too Big to Work
25 October 2012

Spain’s efforts to sell as much as 90 billion euros ($117 billion) of toxic property assets it uses to create a bad bank from lenders that take state aid will be constrained by the size and inability to provide credit to potential buyers, adding to the risk of taxpayer losses.

“When managing tens of thousands of assets scattered across the whole of Spain, big is not beautiful, it’s sheer chaos,” said Mikel Echavarren, chairman of Irea, a Madrid-based financial adviser. A large, “clumsy” bad bank will be at a “tremendous” disadvantage and will generate losses that Spaniards will have to pay for.

The country has until the end of next month to establish the institution, a condition of 100 billion euros of external aid for its financial system requested in June. Premier Mariano Rajoy’s government, seeking to purge about 180 billion euros of bad assets linked to real estate that the Bank of Spain says are on the balance sheets of lenders, has said it will be profitable and won’t cost taxpayers.

Source: Bloomberg Business Week

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Spain unions call general strike November 14
24 October 2012

MADRID — Spain's labour unions Friday called a general strike for November 14, the second such blanket action this year against the government's biting austerity measures.

The UGT and CCOO unions said they had approved the multi-sector strike as part of a broader day of action called by the European Trade Union Confederation.

"Unemployment, cuts, the impoverishment of the majority and the deterioration of public services justify a general strike," the CCOO said in a statement.

Source: AFP

Like 0        Published at 17:04   Comments (0) no longer allowed to operate in Spain
23 October 2012

Currency exchange website is no longer allowed to operate in Spain as it is not able to satisfy the regulatory requirements to do business in Spain.  I just received the following email from them:

We regret to inform you that effective October 26, 2012 will no longer be able to offer the XE Trade payment service in Spain.

Unfortunately at this time we are not able to satisfy the regulatory requirements to continue to provide XE Trade services in your country. We apologize for the very short notification period given, however it is incumbent upon us to take this action by this date. We will, however, honour any trades entered into prior to October 26, 2012.

We will continue to investigate options for re-entering the Spanish market in the future. In the meantime, we apologize for any inconvenience and thank you for using XE Trade to date - we very much appreciate your business.

If you have any further questions or concerns, please feel free to Contact Us.


XE Trade Customer Service

Like 0        Published at 14:45   Comments (5)

And yet another Spanish region asks Madrid for a bailout - this time it's the Balearic Islands
19 October 2012

Just after I posted my earlier post about the Asturias bailout, I read that the Balearic Islands have also asked for a bailout.  They're coming thick and fast now.  Are there any Spanish regions that won't need a bailout?  From Reuters

MADRID (Reuters) - Spain's Balearic Islands became the seventh region to seek financial aid from the central government on Friday when it asked for 355 million euros (289.5 million pounds) to repay debts and finance its deficit.

Its request means that just under 17 billion euros of the central government's 18 billion euro regional liquidity fund has already been tapped, leaving it with little firepower left to shore up regional finances.

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Another Spanish region requests a bailout from the national government
19 October 2012

I've lost count how many Spanish regions have now requested a bailout.  The latest to request a bailout from Madrid is Asturias, which is requesting 261.7 million euros from the rapidly depleting EUR18bn 'temporary' bailout fund.  From Reuters:

Oct 19 (Reuters) - The northern Spanish region of Asturias asked the central government for 261.7 million euros ($343 million) in aid on Friday, the eighth autonomous region to tap Madrid's regional liquidity fund set up to cover their financing needs.

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Spain Banks Face More Pain as Worst-Case Scenario Turns Real
18 October 2012

Spain’s banks face more loan losses as the pace of an economic slump risks turning a worst-case scenario dismissed in stress tests into reality.


Bad loans as a proportion of total lending jumped to a record 10.5 percent in August from a restated 10.1 percent in July as 9.3 billion euros ($12.2 billion) of loans were newly classified as being in default, according to data published by the Bank of Spain on its website today. The ratio has climbed for 17 straight months from 0.72 percent in December 2006, before Spain’s property boom turned to bust.

Spanish bank stress tests by management consultants Oliver Wyman have factored in an economic contraction totaling 6.5 percent from 2012 to 2014 in an adverse scenario that the government and Bank of Spain said has a probability of about 1 percent. Analysts at Nomura and Citigroup (C) Inc. disagree, saying spending cuts and economic conditions mean the worst-case outcome already looks feasible.

Read the full article at Bloomberg Business Week

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Spain does not need a bailout - Luis de Guindos
05 October 2012

Spain's economy minister Luis de Guindos has denied that his country needs a bailout.

His speech in London was interrupted by a group of protesters who waved placards saying "Spain for sale" - opposition to austerity cuts is high in the eurozone's fourth-largest economy.

Rumours have circulated that Spain will ask for a bailout, as soon as this weekend.

But he said: "Spain does not need a bailout at all."

The Spanish government has found itself in financial difficulty since the 2008 global financial crisis caused a big crash in the country's over-heated property market.

The latest austerity measures unveiled in Spain's last budget, which came against a backdrop of violent protests, aim to make savings of around 13bn euros next year, by cutting public sector wages, education, health and social services.

Read the full article on BBC News

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Spain takes its begging bowl to London to seek investors for bad bank
04 October 2012

Spain's Minister for the Economy is in London today seeking investors for it's bad bank.  Good luck with that one!  According to Reuters:

Spain's Economy Minister will meet investors in London on Thursday in the hope of tempting them to buy into a 'bad bank' that will house billions of euros of the country's soured real estate assets.

Madrid hopes the newly formed asset management company will help unblock the credit flows to businesses and families that have been progressively choked off as the country's economic crisis has worsened.


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Council "workers" in my town now have to work an extra half hour per day
03 October 2012

Council "workers" where I live now have to work an extra half hour per day as of 1st October.  This is in line with new laws recently passed by the national government making civil servants and council workers to work an extra 2.5 hours per week.

So officially, they are supposed to work a 37.5 hour week which seems reasonable.  However, they all dissapear for breakfast at 10:00am for half an hour, so they are only really working 35 hours per week, which is still a lot better than the 32.5 hours they used to do.

It'll be interesting to see if they actually work this extra half hour each day or whether they just take the extra half hour for their breakfast.  Or maybe they will turn up half an hour late.  Maybe I'm being too cynical.

There is still no sign of any redundancies yet, despite the town hall having a total workforce of 600 workers for a population of 11,000.  That's one council "worker" for every 18 people.  Utter madness, especially since it has been struggling to pay salaries each month for at least the last 3 years.



Like 0        Published at 23:31   Comments (0)

Spain's tax take tumbles as companies go abroad
03 October 2012

(Reuters) - Spain's corporate tax take has tumbled by almost two thirds from pre-crisis levels as small businesses fail and a growing number of big corporations seek profits abroad to compensate for the prolonged downturn at home.

Attractive tax benefits can accrue to companies expanding overseas, but for Prime Minister Mariano Rajoy's government, which now seems resigned to accepting a European financial rescue, the income flow is reversed.

Source: Reuters

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