The State has approved a deal in which Unicaja, Andalucia’s biggest savings bank, takes on Banco CEISS without paying a eurocent.
Banco CEISS was formed out of the ruins of Caja España and Caja Duero. It too, promptly went bankrupt. The taxpayer has so far injected 525 million euros into this trainwreck.
However, Unicaja has, very sensibly, refused to accept ANY of the liabilities of CEISS. Instead, all assets of CEISS will be turned over to Unicaja, giving the savings bank a lot of new officies; the taxpayer sends all of the bad debt, liabilities and taxpayer loans to the FROB, the state owned “bad bank”.
In return, the (PP) President of Castilla y Leon (Cajas España and Duero were both from Castilla y Leon) gets to tell the voters that he’s saved all the jobs in the old offices (well, until the Unicaja closes all the underperforming branches, claiming the EU has made them do so).
Not just this however – CEISS just received ANOTHER 625 million euros in taxpayer backed convertible bonds (ie it took on another loan backed by the state). Unicaja doesn’t have to take out this money if it doesn’t want it, but it’s an additional little “gift” – it gets a free, state backed 625 million euros overdraft thrown in.
Not a bad deal for Unicaja, eh?