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Spanish Banks Surge as Fears Subside Over EU Mortgage Ruling

  • Refunds can be limited to extra interest from 2013: court aide
  • Top EU court will rule in coming months on mortgage case
A sale sign near Bilbao metro station in Madrid.
Photographer: Angel Navarrete/Bloomberg
Updated on

Spanish banks such as Banco Popular Espanol SA surged after an aide to the European Union’s top court said they may avoid having to refund billions of euros to customers who paid too much interest on home loans before a 2013 ruling on so-called mortgage floors.

Spain is entitled to apply the time limit due to the “macroeconomic issues associated with the scale” of the unfair mortgage terms, Advocate General Paolo Mengozzi of the EU Court of Justice said in a non-binding opinion Wednesday. The Luxembourg-based EU tribunal follows such advice in a majority of cases.