BBVA Chaiman Urges Speedy Fix For Troubled Cajas
April 08 2011 - 5:31AM
Dow Jones News
Spain's government and bank regulator must work swiftly to clean
up and recapitalize ailing lenders, and then auction them off to
stronger banks, the chairman Banco Bilbao Vizcaya Argentaria SA
(BBV) Francisco Gonzalez said Friday.
"The important thing is to do it quickly. Not in years, but in
months," Gonzalez said at an event in Berlin, according to a press
release from the bank.
"The public sector cannot be turned into a manager of banks in a
crisis," he added.
Worries about Spain's banking sector flared again last week,
when one of the biggest mergers among the unlisted savings banks
fell apart at the last minute due to worries about the solvency of
one of the banks.
That lender, Caja de Ahorros del Mediterraneo (CAM.MC), known as
CAM, was then forced to ask for a cash injection of EUR2.8 billion
from Spain's state-financed Fund for Orderly Bank Restructuring,
which could lead to its nationalization.
CAM has in recent days also reached out to Spain's biggest
banks, including BBVA and Banco Santander SA (STD), in an attempt
to sell itself and avoid nationalization, according to people
familiar with the matter.
BBVA's Gonzalez said policy makers must identify the capital
needs of each bank, recapitalize them, and --if they've been
propped up with tax-payers' money-- auction them off quickly.
"These auctions should be presented to the strongest players in
Spanish and international banking," he said.
The Spanish government is under pressure to shore up
international confidence in the health of the country's banks and
in February set new minimum capital requirements. It said it would
take equity stakes in those institutions that weren't able to raise
new money. The Bank of Spain estimated that 12 banks would have to
raise a total of EUR15.15 billion.
Company Web site: http://www.bbva.com
-By Christopher Bjork, Dow Jones Newswires; 34 91 395 8123;
christopher.bjork@dowjones.com
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