SHARE
COPY LINK

CRISIS

Spanish treasury gets bond auction boost

Spain raised €4.3 billion ($5.5 billion) of medium and long-term bonds Thursday, more than it had targeted, at lower interest rates, despite market concerns over the financial crisis in Cyprus and the political stalemate in Italy.

The Treasury had expected to raise €3.0–4.0 billion via the bond auctions, and demand outstripped supply by over two to one.

The Treasury sold €589.9 million of five-year bonds at an average yield of 3.598 percent, down from 4.193 percent at the last similar auction held on March 15th, 2012, the Bank of Spain said in a statement.

It sold €660.5 million in eight-year bonds at an average yield of 4.477 percent, down from 5.517 percent from the last similar auction held on November 22nd.

The Treasury also raised €3.06 billion in three-year bonds at an average yield of 3.019 percent.

This auction was not comparable to previous sales of three-year-bonds since it had a fixed coupon of 3.3 percent instead of a coupon of 3.75 percent in the previous operations.

The risk premium or spread — the extra rate demanded by investors in Spanish 10-year bonds over the rate offered by equivalent German bonds — stood at 354 basis points shortly after the bond auction, down from 363 basis points when markets opened on Thursday.

Member comments

Log in here to leave a comment.
Become a Member to leave a comment.

CRISIS

Elderly deaf and dumb couple face eviction over son’s debt

The proposed eviction of an elderly couple who are deaf and dumb and can’t read or write because they unwittingly acted as guarantors for their son’s bank loan has sparked public outcry in Spain.

Elderly deaf and dumb couple face eviction over son's debt
Photo: Benjamin Pleguezuelos / change.org

Bankia made the decision on Monday to cancel the eviction of an elderly couple who are disabled and illiterate after bowing to public pressure and a change.org petition that collected 220,000 signatures in just 48 hours.

Last month Maria del Carmen Lebron, 81, and Antonio Pleguezuelos, 76 who have lived in their home in the Madrid suburb of Pinto since 1970 were given an eviction notice as Bankia called in an outstanding debt owed by their son Gregorio.

It was only then that they learnt that in 2005 they had signed documents acting as guarantors for a €219,500 mortgage for their son, even though they hadn’t understood what they were signing.

In fact the mortgage agreement states that the contract was read out to the couple by a notary and that they had fully understood and agreed the terms. Their lawyers now argue that the agreement was invalid as both are completely deaf – Antonio lost his hearing when he was four years old after falling ill with meningitis and Maria del Carmen was deaf since birth.

When their son lost his job in the crisis and fell behind on mortgage payments the bank called in the debt and demanded they leave their house by January 30th 2017.

  Their eldest son Benjamin made the case public starting a petition on change.org which garnered more than 200,000 signatures in just 48 hours and made headlines across Spain.

On Monday, Bankia announced that it had stopped the eviction order and would cancel the debt “given the particular vulnerability observed in this case”.

The case highlights the still ongoing plight of indebted homeowners suffering years of unemployment as a result of Spain’s economic crisis.

During the peak of the eviction crisis as banks called in loans, hundreds of families were evicted each day. In 2013, some 50,000 families were turfed out of their homes.

SHOW COMMENTS