Spain's Premier Reaffirms Savings Banks Support

[interestrateripoff]

http://www.telegraph.co.uk/finance/financetopics/financialcrisis/8291387/Spains-premier-reaffirms-savings-banks-support.html

Mr Zapatero said it was his government's duty to take charge of ensuring prudent recapitalization of savings banks or "cajas."

"We take charge of events, of course, because it's our duty, but everything has a reasonable limit," Zapatero said. "We want cajas to receive private money from private investors so that they become more solvent and have a greater capacity to offer credit to help companies and families, and so that the economy may move forward and recover more quickly."

Zapatero's statement followed media reports that Spain's government could step in early to provide funds for savings banks unable to raise enough private finance to comply with new recapitalization requirements.

The state could make money available as early as March by buying shares in struggling savings banks of "cajas," leading newspaper El Pais reported Sunday, citing unnamed sources close to the process.

Finance Minister Elena Salgado on January 24 announced the government was to require cajas to raise core capital levels of between 9 and 10pc by September, a hike from the 6pc capital ratio requirement they have been operating on.

Interesting, I wonder with what funds the Spanish govt will be buying these shares with, there only option is to fund this via debt..... So the cajas are losing money, the Spanish govt hasn't got any money so Spain is going to sell more debt to cover the bad losses of the banks. Genius.

Still I'm sure it's contained especially as the Spanish central bank can now print free money.

[EvilEdna]

"More solvent"

Either you're insolvent or you aren't surely?

[interestrateripoff]

"More solvent"

Either you're insolvent or you aren't surely?

You would have thought, clearly though not if your a bank. It would appear you can become more solvent.

[Bloo Loo]

If some people lose their savings, then it is a clear and present duty on every other citizen to take out a loan to pay them back....just sucking more wealth out..but..who cares.

[VickieJo]

The problem with Zapotero is that he blows with the wind. As so much pressure has come on the cajas he is talking about a bail out but only last summer when the storm abated for a bit he actually increased Spanish public spending....

Sooner or later Spain wil hit real trouble.

[Rubens]

It's taken me a while to post for the first time, though I follow this forum from time to time. I thought I would illustrate what's in the bowels of these "cajas" with a picture, there are literally thousands of these monsters all over Spain, kept alive by financial trickery (i.e. still valued at bubble prices, sitting on the balance sheet of these savings banks). This makes price correction here very slow.

Anyway, it doesn't matter, every rule has been, and will be, bent for the banks as many times as it is necessary to bring down the system with them. I think I'll just enjoy the weather while I can.

Greetings from Spain.

[interestrateripoff]

It's taken me a while to post for the first time, though I follow this forum from time to time. I thought I would illustrate what's in the bowels of these "cajas" with a picture, there are literally thousands of these monsters all over Spain, kept alive by financial trickery (i.e. still valued at bubble prices, sitting on the balance sheet of these savings banks). This makes price correction here very slow.

Anyway, it doesn't matter, every rule has been, and will be, bent for the banks as many times as it is necessary to bring down the system with them. I think I'll just enjoy the weather while I can.

Greetings from Spain.

Looks nice, I wonder how high it was meant to go?

[Deckard]

Looks nice, I wonder how high it was meant to go?

Penthouse living in the sunshine, anyone?