Despite the economic gloom that has enshrouded it since the onset of the global financial crisis, Spain has at least one industrial bright spot: The country and its skilled, if underemployed, work force have once again become a beacon for European carmakers, the New York Times reported today.

Investors in Spain's embattled Bankia can take some comfort from the prior experience of shareholders at Ireland's largest retail bank, Allied Irish Banks, according to an Reuters analysis yesterday. Bankia now has a negative equity value of 4.2 billion euros ($5.6 billion), according to Spain's bank rescue vehicle. But the previous treatment of AIB's shareholders suggests Spain is likely to be successful in convincing the European Union to allow Bankia's existing shareholders to retain a tiny stake in the recapitalised, and newly valuable bank.

Spain's Banco Mare Nostrum and three other banks secured EU regulatory approval on Thursday for their restructuring plans which include cutting their balance sheets by between 25 to more than 40 percent over the next five years and halting dividend payments, Reuters reported. The European Commission imposed the measures in return for approving the bailouts of savings banks BMN, Caja Espana-Caja Duero, Caja 3 and Liberbank which were hit by the collapse of a long property boom in 2008.

Spanish house prices plummeted in the third quarter, a sign that the five-year-long property bust at the core of the country's economic crisis will continue to pose problems for the government, banks and households, The Wall Street Journal reported. In an indication that the market isn't yet bottoming out, Spanish housing prices are now falling at the fastest pace on record, after double-digit falls over the past year.

The European Central Bank's pledge to stand by vulnerable euro zone members will be enough to ensure Italy and Spain find buyers for their bonds at parallel auctions on Thursday, Reuters reported. In Italy, the ECB's bond-buying scheme is seen as a solid enough counterweight to the political tension and market jitters triggered by Prime Minister Mario Monti's weekend announcement of his intention to step down early.

The Spanish government said it won't make extra payments expected by more than five million retirees to adjust for this year's inflation, one of the toughest austerity steps yet in its struggle to slash a gaping budget deficit, The Wall Street Journal reported. The measure announced Friday means the government will withhold an estimated €3.86 billion ($5 billion) from older Spaniards, sending ripple effects throughout society. With more than one-quarter of the workforce unemployed, families rely increasingly on the retirement income of their elders to buttress household finances.

European Union regulators gave the green light to €37 billion ($47.9 billion) in euro-zone funding for Spain's stricken banking sector on Wednesday, setting in motion a long-term cleanup, The Wall Street Journal reported. In exchange, four nationalized banks agreed to make sharp cuts in their balance sheets and payrolls—a retrenchment that carries the risk of intensifying Spain's credit crunch in the midst of a deep recession.

The Bank of Spain has approved the restructuring plans for four of the country's nationalised banks due to receive aid from Europe, Spanish restructuring fund FROB said on Tuesday. The FROB, which controls the banks bailed out by Spain, added that the European Commission was expected to give its definitive approval to the plans on Wednesday. The banks involved are Bankia, Novagalicia Banco, CatalunyaCaixa and Banco de Valencia. The FROB said it expected to receive European funds in the first half of December, and it would then inject them into the banks.

Spanish banks, awaiting the first payments from a €100 billion European credit line, saw bad loans hit a new high in September, new data showed Monday, the Irish Times reported. The new figures will not affect the euro zone aid, aimed at cleaning up the toxic real estate assets from the lenders' balance sheets, but reflect moves by the banks to be more realistic about the extent of their bad loans. A recent independent audit of Spanish banks concluded that they needed capital injections totalling €60 billion to ride out a severe economic crisis.

Mariano Rajoy has always said that when it comes to a possible Spanish bailout, he will do what is right for Spain and right for Europe. So far, it has to be said, the Prime Minister's policy of sitting on his hands has been vindicated, much to the frustration of those who predicted the markets would have forced his hand by now, The Wall Street Journal Agenda blog reported.