Monday, June 25 2018 | ASIA TODAY INTERNATIONAL - Reporting the Business that Matters in Asia
Updated: 6 hours 11 min ago
Insurance projections for 2018 and 2019 show a general improvement, once corrected the volatility in the life savings branch during 2017. Insurance online purchases are still very low in Spain compared with the European Union, but their growth is very significant. According to BBVA big data, car insurance is the most purchased one by card online.
The General Data Protection Regulation (GDPR), which comes into force today, aims to harmonise and reinforce the legal framework of personal data protection in Europe. It is an update of the previous Directive of 1995, which had become clearly obsolete as a result of the rapid development of the new technologies.
Council agrees general position on the banking package. EC issues a proposal for regulation on SBBS and concrete actions on sustainable finance. EBA consults on technical standards and guidelines to quantify downturns for LGD, and updates OSIIs list. Spanish Economy Ministry consults on sandbox proposal. U.S. Congress passes a financial regulation relief Bill.
Adjustments to the number of employees and branches in the sector continue, despite the deleveraging of the private sector seems to be coming to an end. The sector is feeling the effects of the resolution and sale of Banco Popular in June 2017 and posted after-tax losses of €3.9 billion for the year, although it achieved further improvements in solvency and asset quality.
Growth slowed in 1Q18 to 0.4% QoQ, more than expected. Hard data picked up somewhat in March, but sentiment data continues to be hesitant up to May. Our BBVA-MICA model projects growth to remain around 0.4% in 2Q18, and imply a downward bias on our 2.3% annual GDP growth projection.
The CBRT decided yesterday to raise the “de facto” policy interest rate (Late Liquidity Window) by 300bps to 16.5% to correct the significant depreciation of the Turkish Lira, also with other reasons including the huge deviation of inflation from the target and expectations, financial stability motives and rapid loss of credibility during the last two weeks.
The economy of the Basque Country grew 3.1% in 2017; GDP growth is expected to keep its rate at 3.1% in 2018 and slow down to 2.8% in 2019. This will add around 30,000 new jobs in the period and average unemployment shall drop to 8.8%. Creating more and better jobs remains as the main challenge.
The country has made great advances in the last twenty or so years in designing an institutional framework that contributes towards having well-ordered public finances. In 2006 the Federal Budget and Fiscal Responsibility Act was passed.
The way the European Central Bank modulates its tone with each announcement has recently become an important tool for keeping track of monetary policy. This has come about since central banks have added specific commitments and credible and transparent communication to their toolbox.
The second round of negotiations held last week between the US and China to resolve a long standing bitter trade dispute has yielded mixed results. While ongoing trade talks have been broadly progressive, they are unlikely to provide a quick fix permanent solution to US-China trade tensions, which stem from bilateral trust deficit and deeper structural issues.
President Trump’s decision to withdraw the U.S. from the nuclear agreement with Iran has generated unease in the markets. The price of Brent crude was close to US$80 per barrel in the days following the announcement, a level not seen in the last four years. The withdrawal from the agreement by the U.S. means the re-establishment of the economic sanctions imposed on Iran
Positive global momentum continued at the beginning of 2Q18, but in a context of greater uncertainty. Hard data indicators have been mixed with robust industrial production but more hesitant private consumption and global trade. Across large areas, US data has been positive while the EZ is stabilizing after a disappointing 1Q and China is decelerating very slowly
Highlights: BCBS and IOSCO issue criteria to identify STC securitisations, and standards for their capital treatment. EIOPA launches EU-wide stress test. CNMV consults on disclosure models for financial reports. BdE consults on draft circular regarding the comparability of fees. Finally, U.S. agencies issue proposed rulemaking regarding Current Expected Credit Losses.