Restructuring Spain’s banking industry has not only cost money, but also the division between healthy and sick entities.
Those banks in better conditions were forced to help the ones faced with nationalisation. None of the so-considered strong financial institutions wholeheartedly accepted the deal, but they did it. At the end, they suppported the sector’s reorganization with €7.5 bn, mainly through contributions to the Deposit Guarantee Fund and the Bad Bank Sareb.
Specifically, contributions from healthy banks amounted as follows: Banco Santander provided with €4bn; Popular €1.7bn ; Caixabank gave €966 M; Sabadell transferred €750 and Bankinter, €66M.
Against the background of the EU’s Single Resolution Mechanism, Santander’s chairman Emilio Botín said some time that he completely agreed with the fact that taxpayers and well managed entities should not pay again the cost of financial crisis.
Spain’s second largest bank BBVA Francisco González also demanded publically that those “responsible” for the national savings banks’ crash were identified. Furthermore, Bankinter’s CEO María Dolores Dancausa repeatedly reminded this institution’s well management.
Neither Santander nor Bankinter purchased any entity during the years of crisis, while Popular acquired Banco Pastor, BBVA bought Unnim, Sabadell absorbed CAM and Caixabank included Caixa Girona, Bankpime, Banco de Valencia and Banca Cívica in its new architecture.
First Spain’s and Euro zone’s bank by market value Santander provisioned and restructured €65 bn since the crisis began. It also was able to generate €18.4 bn in terms of capital without having public aids in any of the countries where the entity operates.
Despite BBVA’s head complaining that the savings banks bankrupcy meant “a great cost of opportunity” for the whole financial industry and the Spanish economy, he did not exactly evaluate how much the reorganization cost was. BBVA decided not to enter in the bad bank Sareb and contributed the Deposit Guarantee Fund’s with a gross amount of €120M in order to provide preference shareholders of Novagalicia Banco and Catalunya Banc with liquidity.
Following Mr. González’s statements, Bankinter’s CEO María Dolores Dancausa repeteadly reminded that Bankinter did not demand for public aids in 2013, transferred toxic assets to Sareb and used deferred tax assets to increase capital and solvency either in these last years.
According to the Spanish Court of Auditors, public resources used for the financial sector’s reorganisation amounted an overall figure of €107.9 in the period 2009- 2012, including costs and funds dirbursements- for instance the contribution of €57 bn in terms of capital or preference shares- as well as collateral securities holding a future maturity and maximum available amounts in credit lines.
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