MADRID | Capital Madrid | The Spanish savings banks or cajas, unlisted entities often linked to the country’s regions, have come under intense scrutiny since the beginning of the crisis, as some became associated with the worst excesses of the banking sector. But they have already started a restructuring process: by 2015 they will be 35% smaller.
The Spanish Banking Association wants nationalised entities dismantled or sold, as the toxic legacy of the savings banks has become too poisonous for too long (with information from Ángel Laso, valenciaplaza.com correspondent in Madrid).
LONDON | Fitch expects that the sector’s restructuring efforts fuel the higher level of consolidation seen since the reforms started last year.
By Javier Niederleytners, professor at the Institute for Stock Exchange Studies IEB | Market pressure right now has relaxed over the country’s public debt and it seems to be a good moment to sell part of their bond holdings to cancel ECB loans.
The Spanish banks’ correction in February was 5.2 percentage points higher than the average in the eurozone.
Spanish Minister of Economy Luis de Guindos gave some hope on Tuesday to the 80,000 Bankia customers stuck on preferred shares and subordinated debt: an arbitration process will be in place in those cases where there had been bad practice. Two other nationalized banks (Novagalicia Banco and Catalunya Banc) are using the same procedure so their clients will be able to get back at least 60% of their money.
MADRID | By Carlos Díaz Guell | The Spanish bank’s bailout, added to the reforms and decisions made during the last years, can effectively complete the country’s banking puzzle and halt the worsening of a seemingly never ending crisis.
Over 80 percent of all Spanish deposit banking institutions–six of them systemic–will be inspected by the European Central Bank from 2014.
The first 3-year injection auction in November 2011 allowed the Spanish banking to get cheap and long-term funds, which substantially varied its liquidity position. According to AFI analysts, it also limited risks associated with restrictions to renew and issue bank debt and to attract sufficient retail funds to offset the fall in wholesale funding.
Investors have responded with interest to some recent capital increase plans and debt sales from large Spanish banks. But it is too early in the year to infer an improvement in perceptions.