The Italian banks are struggling for survival. And the prospects for some of the biggest German banks are also gloomy. But the authorities in both countries are reluctant to act quickly on the assumption that time may solve the problems.
MADRID | Bankia shares seem to have become a toy amid high volatility on the Madrid stock market index Ibex35. This week so far the entity suffered a -16.08 percent loss of price in two consecutive sessions, after the State fund for banking restructuring FROB announced that stockholders will be partially shouldering, too, the costs of the rescue of the bank with taxpayer money. Banco de Valencia stock fell by -23.8…
MADRID | Bankia’s Chairman brilliant performance in transforming the hole he found in his company as an opportunity to ransack the public coffers, has turned him in government’s shadow financial policy maker. His recipe to cure banking ills will receive little praise in economic circles. But it sounds extremely simple and effective. Writing down bad loans resorting to taxpayers’ money amounts to a rather dull endeavour. Bur indulging in such…
MADRID | Ever since double entry accounting was developed in Middle Age Italy, banks have been able to mask shortcomings till the very verge of their implosion. After all, in every single balance sheet, assets always match liabilities to the last penny. The figures’ real value just becomes a matter of opinion, as recent discomfitures have shown. Lehman Brothers led the way many others have followed. The turn has come now…
MADRID | Rescuing BANKIA will contribute to cut short doubts on short-term Spanish banking solvency. It was no secret that BANKIA was thrown in deep waters by the demanding government requirement to uplift real estate portfolio, having the dubious merit to top the list of entities laden with bad loans. Its intention to mend this state and play on its own gathered widespread disbelief, as big potential partners turned their backs…
MADRID | The Spanish government has good reasons to feel irritated at the Bank of Spain’s erratic conduct. It has endorsed bank plans to meet the reform targets without raising any objection. Yet, it has failed to provide any credible explanation on how credit institutions might raise €45 billion in the coming months. Taking for granted that Santander, BBVA and CaixaBank will easily achieve their required €10 billion provisioning, that leaves…
By Luis Arroyo, in Madrid | At FTAlphaville there recently was talk about the Spanish banking system. Sí, that particular banking system that, according to the Bank of Spain governor Fernández Ordóñez, has fixed itself without the nation’s Treasury putting any euro at all. The answers to questions like who ordered him to say this, and what for, when everybody knows and complains about public capital injections in our banks are…
MADRID | The Bank of Spain has cleared the plans presented by financial institutions to meet the demanding requirements designed to clean up real estate exposure. As expected, extra needs fall short by 10% to the €50 billion that the government forecast when launching the reform in February. Considerable adjustments undertaken at last year close have eased up the pending effort. Will this encouraging result calm down market concern? There is…
MADRID | Governments become arrogant over time and the more arrogantly they behave, the worse they do their job. Indeed, arrogance is usually a bad influence, as it leads to confusion and errors. Former president of Catalonia and an old hand in Spanish politics, Jordi Pujol, in his latest memoirs wrote of former Spain’s presidents that José María Aznar’s political ambition dwindled away because of his pride and Rodríguez Zapatero’s did so…
MADRID | Barclays analysts said in an investor note on Monday that further worsening in Spain’s case should be very limited, as government policies tackle the key problems with the right solutions, in spite of mistakes being made. Experts remained confident the financial sector has gained sufficient funding at least until 2015 after having taken advantage of the latest liquidity operation carried out by the European Central Bank. The report…