Spanish banking stocks plunge as short sellers move in again and fears of possible Greek default re-

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http://elpais.com/elpais/2012/02/16/inenglish/1329410163_243434.html

Spanish bank stocks fell sharply on Thursday after the National Securities Commission (CNMV) decided to lift the ban on short-selling of the shares of financial companies.

Investors were also unnerved by a further delay to an agreement on a second bailout for Greece, raising the specter again of a messy default. The fall in banking stocks also coincided with an announcement overnight by Moody’s Investors Service of ratings action on 114 financial institutions in Europe. This includes 21 institutions in Spain, including Santander BBVA, Bankia and CaixaBank.

Moody’s argued the action was justified by the “adverse and prolonged impact of the euro area crisis, which makes the operating environment very difficult for European banks.”

Among the Spanish banks most affected was Bankia, which shed over eight percent due to the added concern of its exposure to the ailing property sector. The bank’s parent BFA on Wednesday said the value of land on its books as a result of loan foreclosures shot up 56 percent in six months to 4.714 billion euros.

[midnight]

1. K&R