We need 12 billion to save Bankia (and the economy will shrink another 0,3% this quater)

De Guindos, the economy minister, has announced that Madrid will have to sign a check for 12,000,000,000€ to save Bankia, the failed bank that went titsup last week, instead of the original 4,5 billion euros expected. (El Mundo)

Interestingly enough, that’s almost as much as Madrid slashed off the health and education budgets (14 billion) in an attempt to make savings and stop the country running out of cash.

Bankia has an exposure of some 37 billion euros to bad real estate debt, so expect the figure to keep rising.

Despite this, nobody (except Expansión) has suggested that they flog off their two HQ buildings in Madrid, the Norman Foster designed Torre Foster (worth 800 million) and the Kio Torres (worth about 210 million).

Look, just let the damn bank die already. Spin out the savings accounts and flog off the dead apartments at 10K a pop to the homeless.

In other news, De Guindos expects the Spanish economy to contract a further 0,3% this quarter, and unemployment to rise even further.

 

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