News Summary: Record retail sales drop in Spain

Associated Press

THE DROP: April retail sales in Spain fell 9.8 percent versus a year ago as the country battled high unemployment and its second recession in three years. It was the 22nd straight monthly retail sales decline.

THE CONTEXT: The central Bank of Spain says the economy shrank 0.3 percent in the first quarter. It predicts the trend to continue at least through June, for a total contraction of 1.7 percent in 2012.

BANKING MERGERS: Three regional savings banks, known as cajas, said Tuesday that they were considering combining. That news came just days after Bankia, the nationalized lender that is itself the product of a combination of seven cajas, said it would need a massive bailout.

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