Short-selling banned on Spain's Liberbank to stem market contagion

Madrid

MARKET regulators prohibited short-selling on Spanish lender Liberbank SA after its shares dropped 41 per cent last week, when a competitor was taken over because of a run on deposits.

The Spanish securities regulator CNMV, working in concert with the European Securities and Markets Authority (Esma), banned the sale of borrowed shares beginning from 8.15am Madrid time on Monday until July 12, Esma said. The CNMV reported that "market confidence has deteriorated in relation to a part of the local banking sector", Esma said, without specifying the extent.