Cajasur slips beneath the surface… only a few bubbles left

Normally, when a bank collapses, you hear a lot about it. TV images of people queuing to get their money out. Maybe a riot.

Not, however, over the weekend when Cajasur, the savings bank owned and operated by the Catholic Chuch in Cordoba, quietly gave up the ghost after, amazingly, walking away from a rescue deal offered by Unicaja. Madrid quietly shut off the life support machine on Saturday, and a few grieving relatives had a boozeup in the local pub. All in all, a peaceful passing.

Cajasur, which has -had- a solvency level of just 3,67% on Saturday (far underneath the 8% minimum dictated by law), had been offered a nice deal by Unicaja in which the Cordoba Church got some shares and a director post. Seems this wasn’t enough for the Bishops, who, despite the deal having been accepted by Unicaja, walked away last week in the hope of upping the offer (officially, for “workers rights”, what ever that means).

Goodbye Unicaja, hello UniCajaSur (and a bit for the blighters in Cordoba Church too) posting from July 2009.

However, when their Holinesses went back to the State for another handout, they were shocked to find the door slammed in their face and administration proceedings launched against their Caja.

The Banco de España has forcibly taken control of the bank’s assets and fired the entire board of directors, including Reverend Santiago Gómez Sierra, the President of the Caja. A new board of administrators have been appointed to see how best to wind things up, and have a month to present a plan.

Griñán, via a Junta spokesperson, said that depositors (right, like they had any left), should “remain calm” and that the Banco de España had things in hand. It’s worth pointing out that after the collapse of Caja Castilla La Mancha CCM (later bought for a song by Unicaja) Madrid removed the right to administer bankrupt Caja’s from the regions and gave it to the Banco de España – I don’t think anyone told the Bishops this.

Cajasur represents 0’6% of the Spanish banking system. It lost about 336 million euros last year, and probably even more this year. Most of the money went on dodgy real estate deals that are still half built.

From El Mundo.

The collapse of the bank coincides with an IMF call for Spain to “urgently reform a “dysfunctional” labour market, and its banking sector.” (from the BBC).

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