The Spanish government has agreed to extend the country’s emergency paid leave schemes for an additional three months to the end of September — a costly measure that business and unions say is essential to prevent the widespread collapse of companies and job destruction, the Financial Times reported. The temporary schemes, known as ERTEs, had been due to expire on June 30 and currently cover more than 2m people who hope to return to their jobs as the crisis eases but who are far from sure of doing so.
Spain scrapped the threat of forced liquidation for companies that run up major losses this year as part of a series of changes announced by the government to stave off insolvencies amid the economic turmoil caused by the coronavirus, Bloomberg News reported. Alongside the adjustment to bankruptcy laws, investors who put money into businesses in the wake of the Covid-19 outbreak will also benefit from higher levels of protection in the event the companies fold.
HSBC Holdings Plc and Banco Santander SA took the biggest hits so far among European banks struggling to contain the impact of the coronavirus on their loan books, with the U.K.-based lender expecting as much as $11 billion of damage this year because of the outbreak, Bloomberg News reported.
Spain’s economy could contract this year by more than 12% in a worst-case-scenario forecast by the country’s central bank, the first official figures that spell out the potential toll of the coronavirus pandemic on the European Union’s fourth-largest economy, Bloomberg News reported. The economic shock could push the unemployment rate to as high as 21.7% this year, undoing gains achieved in the aftermath of the 2008 global recession and the subsequent European debt crisis. At nearly 14%, Spain’s unemployment rate is already one of the highest in the developed world.
Spanish bankers and lawyers are bracing for a steep surge in insolvencies, amid the country’s rising death toll and strict lockdown measures. In an attempt to offset the economic cost, Prime Minister Pedro Sanchez last month announced a 117 billion euros ($128 billion) fiscal stimulus, but some business leaders say aspects of the government’s response risk making things worse, Bloomberg News reported. All those who work in non-essential services must remain at home over Easter, but the government says that companies must pay employees in full during that time.
Spain offered more help to households and small companies on Tuesday to try to calm fears about the country’s mothballed economy and shield the population from losing their homes during the coronavirus lockdown, Reuters reported. Infections and deaths from the virus are still rising, but health officials said the pace had slowed in the past few days. Confirmed cases rose by about 11% to 94,417 and the death toll hit 8,189 after 849 fatalities were reported overnight.
Singapore’s most high-profile restructuring case has attracted a new offer from a Spanish company, adding more uncertainty to a drawn-out process that’s left many retail investors in the lurch, Bloomberg News reported. Water treatment firm Hyflux Ltd. said in an exchange filing that FCC Aqualia SA, which is also in the water management business, plans a potential transaction involving it or its assets, without giving details. Hyflux investors have already been evaluating two different takeover offers and one debt-purchase plan.
Airbus announced plans to halt operations at its plants in France and Spain for four days as the coronavirus crisis spread from battered airlines to the manufacturing sector, The Irish Times reported. The most serious across-the-board disruption in Airbus production since a strike at then British partner BAE Systems in 1989 pushed its shares down 7 per cent as a rebound in other European shares quickly faltered.
King Felipe VI of Spain said on Sunday that he was renouncing his personal inheritance from his father, Juan Carlos, who has been implicated in a Swiss offshore account investigation, the International New York Times reported. King Felipe is also stripping his father of his stipend, in an apparent bid to sever any financial linkage between the Spanish royal household and the former monarch. The announcement came as King Felipe has himself risked getting entangled in the financial scandals centering on his father.
Spain’s Supreme Court ruled on Wednesday that a 27% interest rate applied by online bank WiZink to one of its credit cards was unjustified, a decision that could force other Spanish lenders to cut some of their rates, Reuters reported. Shares in Caixabank, Bankinter and Sabadell fell more than 3% after the much-awaited ruling on the view that it effectively sets guidelines for the sector, even though it was specifically about a WiZink card.