Spain to target troubled banks with new law

MADRID: Spain's government will grant new powers to its central bank allowing it to intervene in troubled lenders “early” while the country's bank rescue fund will win more capacity to wind down failed entities, Spanish newspapers reported.

The enabling law, expected to be approved this week or next, would allow the Bank of Spain to take charge even at banks that met liquidity and solvency requirements, if it was “foreseeable” they could fail to meet the rules in future, newspaper El Pais said, citing a draft document from the Economy Ministry.