The Bank of Spain receives plans from savings banks, or cajas, to boost their capital in order to meet new solvency criteria.
ECONOMY: *Today is the deadline for cajas that were told on March 10 they don’t meet new capital requirements to tell the Bank of Spain how and when they plan to raise the additional funds. The Bank of Spain has until April 14 to approve those plans or demand changes to them. *Spain must be alert and focus on completing economic changes and creating a more flexible labor system to be more competitive, Prime Minister Jose Luis Rodriguez Zapatero said after meeting with Spanish business leaders on March 26. *Spanish business executives who participated in a meeting with Zapatero said early elections would be detrimental to Spain’s economic recovery, Efe reported, citing unidentified people with knowledge of the matter. *Norway’s sovereign fund is interested in investing in small Spanish companies, including lenders or cajas, El Pais reported, citing an interview with the Norwegian central bank’s deputy governor, who is also responsible for managing the fund. *European Central Bank Executive Board member Jose Manuel Gonzalez-Paramo said the ECB remains “strongly vigilant” for inflation risks. “When we say strong vigilance it means that when we assess what the risks to price stability are, they are very much on the upside,” Gonzalez-Paramo told reporters after an event in Washington on March 25.
EQUITIES: *China Construction Bank Corp.’s board has adjusted a plan to set up a rural joint venture in China with Banco Santander SA, the bank said in a statement to the Hong Kong stock exchange yesterday. The venture will have an initial investment of 3.5 billion yuan and CCB will hold 80.1 percent. *Bankinter SA Chief Executive Officer Maria Dolores Dancausa said she sees remote chances of purchasing a savings bank, or caja, as it focuses on organic growth to achieve profit growth of 20 percent in 2011, El Pais reported. *Demetrio Carceller, chairman of Disa Corp. Petrolifera SA, boosted his stake in Sacyr Vallehermoso SA to 15.7 percent, becoming the biggest shareholder in the Spanish builder, Cinco Dias reported, citing a statement from Disa. *Solaria Energia y Medio Ambiente SA sold on the market 159,063 shares from March 16 to March 25. It sold the shares at 2.26 to 2.31 euros each, it said in a regulatory filing. *The boards of Telecomunicacoes de Sao Paulo SA and Vivo Participacoes SA agreed that all of Vivo shares will be owned by Telesp as part of a restructuring. Telesp will boost its share capital and Vivo’s shareholders will get 1.55 new shares of Telesp for each of the Vivo shares they owned, Telefonica SA said in a regulatory filing.
MARKETS: *The IBEX 35 Index dropped 0.4 percent to 10,710.4. *The spread between Spanish and German 10-year borrowing costs narrowed to 189.3.
-- Editor: Chris Peterson