Bankia Shares suspended i Madrid

 Just read on BBC News.Link below

http://www.bbc.co.uk/news/business-18202671

 The Bankia bailout costs are doubling every day. On May 21 it was 4 billion.Yesterday it was 9 billion. Today it is 15 billion plus. This reflects the cash being withdrawn in the unspoken run. Let's face it, you'd have to be nuts to have any money with them.

GuyT, looks worse - Reuters reporting that the Bank has asked for an additional 19Bn over and above the 4.5Bn already put into the Bank.

They (reuters) are also reporting that Spanish Banks have exposure to an identified 184Bn of bad loans associated with real estate.

In addition it was also reported the true scale of the debts of the regions some 35Bn for the current funding round.

Since Spain has no money to bail out the Banks or Regions they will have to raise it through Bonds, which based on the S&P rating of most of the regions being classed one step above 'junk' are going to be expensive, maybe well above the 6% Spain is currently paying.

Looks like difficult times ahead as prices are increased, services cut and large loans with their associated large interest payments are taken on.

David

El apoyo total será de unos 23.500 millones contando los 4.465 millones ya inyectados

23.5 billion Euros - That's about 590€ for every man woman and child in Spain. And this is just one failed financial entity. 

Is it any wonder at all then, that despite having 4964 km of coastline to fish in, they're intent on making such a song and dance about the 3 km stretch of water surrounding the Rock. 

I'm becoming increasingly disillusioned with Rajoy's government - Spain needs British tourists more than ever right now, the pound has finally gained some ground against the Euro, making Spain a bit more attractive for holiday makers and then they pull this stunt. as a diversion to the real problems facing the country.

The final nail in the coffin for the Spanish tourism industry will be when Greece finally leaves the euro, prints drachmas, devalues like Billy-O and British holiday makers discover that 75 pence will buy them a 3 course meal, a bottle of ouzo and a packet of smokes. And quite possibly service with a smile! 

Hi Orinoco - hope you are enjoying the good weather in Spain, lowest May temps in Perth forwaiting to happen. 100 years 1.7C. Will need to come back to sunny Europe -- well have had a moment to think and think I'll stay put.

On Bankia - I'm currently reseaching problem Companies to write case studies for MBA students to study. The more info that I get about Bankia is it was an accident waiting to happen.

In addition to the money they are asking for they have now put into the latest accounts 15.6 bn of provisions against future losses. The revised accountsfor 2011 now show a nettrading  loss of 2.9 bn against a loss origionally reported as 209M.

In addition the parent is selling off assetts including holdings in NH Chain, Iberodola, Indra Sistemas and IAG.

Clearly the state of this Bank is worse than anyone thought no wonder the shares were downgraded to junk.

Is this the end or is there still further bad news to come from the Spanish banking sector?

David

Hi David, we're certainly making the most of weather in our house this weekend! BBQ's, gardening and pool preparation. 

A great AE-P article in the Telegraph today:

http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/9293270/Europes-Maquina-Infernal-has-crippled-Spain.html

Regards,

Steve.