bloomberg.com • Spain’s state-backed development bank says the recovery in the euro region’s fourth-biggest economy is now strong enough for the lender to shift its strategy to focus on quality rather than quantity.
– As it steers away from extending emergency support, ICO is refocusing on helping those companies contributing to an export-led recovery with special loans and trade-finance guarantees, he said. It’s also investing in venture capital and cooperating with other European promotional banks. –
– “Because of a mixture of better funding and an improved economic outlook, people are starting to invest,” Escolano said. “The mood has changed in the corporate sector. Fixed investment in buildings, machinery or transportation equipment will increase this year for the first time since 2008.” –
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Good for Spain and its development bank. Used wisely, development banks can be a powerful tool for driving healthy growth. Used ˝not so wisely˝, they can be a cover for unfair state subsidies and a powerful tool for political meddling and economic distortion.
This Spanish success is interesting from a local perspective, as the Croatian Bank for Reconstruction & Development (HBOR) will soon get a new chief (after 20 years). What model will HBOR emulate? Will the new leadership in fact be new, or will it be another case of Croatian leadership recycling. Time will tell…