Before 2008, Spain Banking system was known as conservative Banks are required to have high capital provisions

and demand various proofs and securities from intending borrowers. Nevertheless this practice was greatly relaxed during the housing bubble, a trend to which the regulator (Banco de Espaa) turned a blind eye. In May 2012 credit ratings of several Spanish banks were downgraded, some to "junk" status. The Bankia bank, the country's largestmortgage lender, was nationalised on 9 May, and on 25 May it announced that it would require a bailout of 23.5 billion to cover losses from failed mortgages. On 9 June 2012 Eurozone finance ministers agreed that Spanish banks would be provided with up to 100bn of rescue loans. On 28 November 2012, the European Commission approves a Spanish government plan to shrink and restructure three major Spanish banks (Bankia, NCG Banco and Catalunya Banc) and sell a fourth (Banco de Valencia).[41] This is part of a 37 billion EC bailout or restructuring approved in June (see above). It includes loss-taking by investors of up to 10 billion, the creation of a "bad bank" to absorb up to 45 billion of failed loans, closing thousands of bank branches, and reduce staff

SPAIN INTEREST RATE

The benchmark interest rate in Spain was last recorded at 0.50 percent. From 1998 until 2013, Spain Interest Rate averaged 2.6 Percent reaching an all-time high of 4.8 Percent in May of 2001 and a record low of 0.5 Percent in May of 2013. Spain is a member of the European Union which has adopted the euro. Spain's benchmark interest rate is set by

C OU N TR Y SPAIN

C A TE G OR Y INTEREST RATE

D A TE S 1998 - 2013

A C TU A L 0.25

HIGHEST 4.75

LOWEST 0.50

UNIT PERCENT

FR E Q U E N C Y MONTHLY

the European Central Bank.

SPAIN MONEY SUPPLY M1 Money Supply M1 in Spain increased to 516210 EUR Million in October of 2013 from 514518 EUR Million in September of 2013. Money Supply M1 in Spain is reported by the Bank Of Spain. Money Supply M1 in Spain averaged 331984.90 EUR Million from 1997 until 2013, reaching an all time high of 534265 EUR Million in June of 2010 and a record low of 88382 EUR Million in October of 1997.
C OU N TR Y SPAIN C A TE G OR Y MONEY SUPPLY M1 D A TE S 1997 - 2013 A C TU A L 516210.00 HIGHEST 534265.00 LOWEST 88382.00 UNIT EUR MILLION FR E Q U E N C Y MONTHLY

SPAIN MONEY SUPPLY M2 Money Supply M2 in Spain decreased to 967979 EUR Million in October of 2013 from 977079 EUR Million in September of 2013. Money Supply M2 in Spain is reported by the Bank of Spain. Money Supply M2 in Spain averaged 677550.51 EUR Million from 1997 until 2013, reaching an all-time high of 1048245 EUR Million in June of 2009 and a record low of 294870 EUR Million in October of 1997.

C OU N TR Y SPAIN

C A TE G OR Y MONEY SUPPLY M2

D A TE S 1997 - 2013

A C TU A L 967979.00

HIGHEST 1048245.00

LOWEST 294870.00

UNIT EUR MILLION

FR E Q U E N C Y MONTHLY

SPAIN MONEY SUPPLY M3 Money Supply M3 in Spain decreased to 1049575 EUR Million in October of 2013 from 1061510 EUR Million in September of 2013. Money Supply M3 in Spain is reported by the Bank of Spain. Money Supply M3 in Spain averaged 815139.96 EUR Million from 1997 until 2013, reaching an all time high of 1184771 EUR Million in June of 2009 and a record low of 413023 EUR Million in April of 1998. Spain Money Supply M3 includes M2 plus long-term time deposits in
C OU N TR Y SPAIN C A TE G OR Y MONEY SUPPLY M3 D A TE S 1997 - 2013 A C TU A L 1049575.00 HIGHEST 1184771.00 LOWEST 413023.00 UNIT EUR MILLION FR E Q U E N C Y MONTHLY

banks.

SPAIN GOVERNMENT SPENDING Government Spending in Spain increased to 52207 EUR Million in the third quarter of 2013 from 51377 EUR Million in the second quarter of 2013. Government Spending in Spain is reported by the National Statistics Institute (INE). Government Spending in Spain averaged 38305.16 EUR Million from 1995 until 2013, reaching an all time high of

C OU N TR Y SPAIN

C A TE G OR Y GOVERNMENT SPENDING

D A TE S 1995 - 2013

A C TU A L 52207.00

HIGHEST 57076.00

LOWEST 19665.00

UNIT EUR MILLION

FR E Q U E N C Y QUARTERLY

57076 EUR Million in the second quarter of 2010 and a record low of 19665 EUR Million in the first quarter of 1995.

The cost of borrowing cash using Spanish government bonds as collateral was little changed on Thursday as the prospect of European Central Bank debt purchases offset the impact of a downgrade in Spain's rating. Standard & Poor's cut the country's rating to BBB-minus, with a negative outlook, just one notch above non-investment grade and in line with fellow agency Moody's, which is expected to conclude its own rating review this month. Usually, when debt is downgraded, rates in repo markets - wherebonds are used as collateral to borrow cash - go up. That is because the price of the bond falls and the value of the collateral is perceived as having depreciated. However, the likelihood that Spain will eventually ask for a bailout kept markets stable. An aid request would activate the European Central Bank's unlimited bond buying programme and protect the value of the bonds - at least for a while. Also, lending terms in Spanish repo markets rarely go beyond one week as lenders are reluctant to offer cash to banks that have been severely hit by a property bust. Shortterm lending rates are less sensitive to the value of collateral than longer-dated rates.

"The rates which people are actually lending at have not changed much, it only brings it in line with Moody's ... and the market is much more focused on whether they're going to ask for a bailout or not," one repo trader said. The one-week repo rate for trades using Spanish bonds as collateral was unchanged at 0.15-0.16 percent, according to traders. In secondary bond markets, 10-year Spanish yields rose as high as 5.96 percent early in the session as an immediate reaction to the downgrade before pulling back to 5.78 percent, below Wednesday's levels. A well-bid Italian debt auction also helped increase investors' appetite to take risks. "Repo rates didn't move because in the short-term risk (sentiment) is still on and the Italian auction was fine," said Matteo Regesta, rate strategist at BNP Paribas. He said a Moody's downgrade may have a stronger impact on the repo market as it will bring the rating of the bonds into "junk" territory. If repo rates rise, Spanish banks' dependency on cash from the ECB could increase. Data from Bank of Spain showed Spanish banks borrowed 400 billion euros from the ECB in September, down from 412 billion euros in August. "This is the effect of the 'Draghi' put," said Commerzbank rate strategist Benjamin Schroeder, referring to ECB President Mario Draghi's pledge that the ECB would buy bonds of troubled countries if they seek assistance. "But when they activate it ... the (availability of bonds as) collateral will actually be getting scarcer," he said, adding that volumes in repo markets would suffer as a result and banks may have to rely on ECB liquidity even more.
SPAIN GDP ANNUAL GROWTH RATE The Gross Domestic Product (GDP) in Spain contracted 1.10 percent in the third quarter of 2013 over the same quarter of the previous year. GDP Annual Growth Rate in Spain is reported by the National Statistics Institute (INE). GDP Annual Growth Rate in Spain averaged 2.20 Percent from 1996 until 2013, reaching an all time high of 5.80 Percent in the first quarter of 2000 and a record low of -4.40 Percent in the second quarter of 2009. Spain is the fourth largest economy in the Euro Zone. The biggest sectors of the economy are services (73.5 percent of total GDP); industry except construction (11.5 percent); construction (9.2 percent) and energy (2.8 percent of GDP). Agriculture, livestock and fishing contribute the remaining 2.4 percent. Yet, Spain is the wo rlds third largest exporter of wine and fruits and vegetables.