Spain

Revelations related to how 82 executives and board members of a Spanish bank were given credit cards to spend freely on personal items and without apparent controls have dealt a blow to efforts to restore the image of the country’ financial sector, the Irish Times reported. The high court is investigating the credit cards, which were given out by Caja Madrid savings bank and Bankia, the lender that absorbed it in 2010, and they were not registered in official accounts.

Trade-only bed bank Transhotel has entered a three-month voluntary administration period as it seeks a buyer to resolve cash-flow issues, Travel Weekly reported. The bed bank, based in Spain, is continuing to trade and will honour bookings. It is in the process of contacting all travel agent and supplier partners to reassure them bookings are safe and to avoid any “knee-jerk reaction” in the trade. Under Spanish law, a company can put itself into voluntary administration for three months to get its finances back in order or prior to closing down.

Codere SA reached an agreement with creditors to restructure 1.1 billion euros ($1.4 billion) of debt, allowing the Spanish gaming company to avoid entering insolvency proceedings, Bloomberg News reported. The company will use the U.K. courts and seek a scheme-of-arrangement to implement the deal, which includes issuing 675 million euros of new bonds and 253 million euros of new loans, Codere said in a statement. Jose Antonio Martinez Sampedro, the current chairman and chief executive officer, will continue performing his executive role in the group, according to the statement.

The number of Spanish companies seeking protection from creditors has fallen to the lowest in three years as the economy recovers and changes to the nation’s bankruptcy rules help heavily-indebted borrowers, Bloomberg News reported yesterday. Insolvency proceedings dropped 28 percent to about 4,000 this year, according to the Spanish rating company Axesor. The nation overhauled bankruptcy rules in March to help troubled companies avoid proceedings, known as concurso, and prevent liquidation.

Struggling Spanish pizza delivery business Telepizza is set to refinance existing loans with a new first lien loan and a new Payment In Kind (PIK) loan that will help it escape an expensive debt restructuring, banking sources said on Tuesday, Reuters reported. The refinancing will repay most lenders in full. Most of an existing PIK loan will be swapped for equity and private equity firm KKR is making a new 180 million euro investment in the company. Private equity firm Permira bought Telepizza in 2006 for 962 million euros ($1.31 billion).

A strong start to the tourist season helped Spain’s unemployment rate fall to its lowest in two years while two banks with large local customer bases said business had picked up, fuelling hopes the country’s economic revival is gathering pace, the Irish Times reported. With a minister suggesting the government might raise its GDP forecast, data showed joblessness fell at the fastest quarterly rate on record between April and June.

Spain has taken an important step toward completing the cleanup of its banking sector by selling the state-owned Catalunya Banc to BBVA for 1.19 billion euros, or $1.6 billion, the International New York Times DealBook blog reported. The sale, announced on Monday night by the state banking restructuring fund, comes after a difficult and delayed auction process for Catalunya. Spain had to inject more public money into the lender than initially expected to attract bidders.

Banco Bilbao Vizcaya Argentaria SA won an auction to buy nationalized bank Catalunya Banc SA, Spain's bank-rescue fund said Monday, The Wall Street Journal reported. Spain's second-largest bank by market capitalization offered to pay €1.2 billion ($1.62 billion) for the lender, the bank-rescue fund said. In a surprise move, BBVA beat out rivals Banco Santander SA and Caixabank SA, which submitted binding offers to the rescue fund on Friday, according to people familiar with the sales process.

Creditors of a bankrupt Spanish motorway business delayed a meeting to decide whether to liquidate it on Friday, two sources close to the talks said, giving the government more time to find a way to prevent billions in debt going on to its books, Reuters reported. After more than a year of negotiations between ministries, banks and construction companies, the government has yet to find a way of saving nine bankrupt motorways, without debt of more than 4 billion euros ($5.4 billion) hitting its deficit.

Creditors of a bankrupt Spanish motorway business will meet on Friday to decide whether to liquidate it, piling pressure on the government to come up with a way to avoid billions of debt from nine failed toll road companies ending up on its books, Reuters reported. After more than a year of negotiations between ministries, banks and construction companies, the government has yet to find a way of saving the motorway businesses without debt of over 4 billion euros ($5.4 billion) hitting its finances.