Spain

Abengoa SA won agreement from major creditors for a rescue plan, potentially averting Spain’s largest corporate insolvency, Bloomberg News reported. Investors including Elliott Management Corp., Centerbridge Partners LP and Varde Partners LP will provide 1.17 billion euros ($1.3 billion) of new loans in exchange for a 50 percent stake, according to a regulatory filing on Thursday. The renewable-energy producer’s existing shareholders, including a company part-owned by the founding Benjumea family, will be left with about 5 percent. Abengoa has until Oct.

Eurozone governments set out new fiscal targets for Portugal and Spain as they backed the decision by the European Union’s executive not to fine them for missing deficit targets, The Wall Street Journal reported. The European Commission had recommended last month after protracted discussions that the two countries should not be fined. The commission acknowledged the difficult economic environment and the reform efforts of both countries, but the decision led some to warn the bloc’s fiscal rules were being dangerously undermined.

Grupo Isolux Corsan SA won creditor approval for a 2 billion-euro ($2.2 billion) debt-restructuring plan, paving the way for a Spanish court to authorize the program, Bloomberg News reported. The engineering company received backing from almost 90 percent of creditors and it intends to ask the court to impose the plan on other bondholders, according to a statement on Thursday. Under the proposal, 1.4 billion euros of debt will be turned into convertible instruments, giving creditors 95 percent of the restructured company. Existing shareholders will retain 5 percent.

Banco Santander of Spain said on Wednesday that its profit declined by nearly half in the second quarter on restructuring charges and a contribution to a fund to help finance bank “bail-ins” in Europe, the International New York Times reported. For the three months ended June 30, the lender reported a profit of 1.28 billion euros, or about $1.4 billion. That compared with a profit of €2.54 billion in the second quarter of 2015. The second quarter included a gain of €227 million on the sale of its stake in Visa Europe.

European Union officials, facing the rise of populist movements across the region, opted against hitting Spain and Portugal with sanctions on Wednesday for breaking the bloc’s rules on government spending, the International New York Times reported. The refusal to impose fines highlights how the 28-nation bloc is struggling with divergent strains of populist and anti-European forces across a region where one member state, Britain, has already voted to leave.

The private sector in Spain is set to shoulder most of the burden as the government moves to bring its wayward deficit into line, after the economy minister unveiled plans to raise an extra €6bn in corporate taxes next year, the Financial Times reported. Madrid is under intense pressure to find new ways to cut its yawning budget shortfall after EU finance ministers agreed on Tuesday to formally open sanctions procedures against Spain and Portugal.

Eurozone finance ministers agreed on Monday (Jul 11) to officially declare Spain and Portugal in breach of the EU public spending rules, a key step to possibly imposing unprecedented penalties against members of the currency bloc, Channel News Asia reported on an Agence France-Presse story. The ministers took the rare step despite fears that too much austerity by Brussels will further stoke anti-EU populism after the Brexit vote.

The European Commission said Thursday that Spain and Portugal didn’t take sufficient measures to bring their 2015 budget deficits within European Union limits, triggering a process which could eventually lead to financial sanctions, The Wall Street Journal reported. Whether, and by how much, the two countries will eventually be fined is a decision the European Commission—the EU’s executive arm—will make later in the summer and after the bloc’s finance ministers endorse its opinion at a meeting next week.

Spain and Portugal are on course to become the first ever eurozone countries to be sanctioned for breaching EU fiscal rules, in a move set to inflame political tensions over how dogmatic Brussels should be in policing national budgets, the Financial Times reported. The European Commission on Tuesday concluded that the two countries had failed to take “effective action” to meet EU deficit rules, according to people briefed on the talks.

Spanish authorities have searched Santander's headquarters in Madrid as part of a probe into alleged money laundering and tax evasion triggered by leaks from HSBC's Swiss private bank, Economia reported. Spanish police were seeking documents related to a number of accounts during the visit on Friday, a High Court spokesperson confirmed. Reuters said the Spanish High Court is investigating 40 cases of suspected tax evasion. It follows the leak of sensitive documents exposing HSBC’s Swiss private bank by Hervé Falciani.