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Shame in Spain lies mainly in the Bank!

A SPANISH Government committee has accused the Bank of Spain of committing “a serious irregularity”, which contributed to the country’s financial crisis.

A parliamentary investigation committee, looking into the Bankia case in which 300,000 investors lost money after the bank, allegedly, falsified its financial statements, said a decision by the Bank of Spain could have played a part in the fiasco.

The committee claimed there were, “nefarious consequences”, after the Bank of Spain allowed “Caja Madrid, Bancaja and five other savings banks not to recognise their financial losses, publicly”.

The committee said the consequences included bankers receiving bonuses, despite their loss-making companies, and banks being able to post favourable financial statements, before Bankia was floated on the Stock Exchange in 2011.

More than 300,000 investors bought shares for a minimum of 1,000 euros, following a major 2011 advertising campaign by Bankia, assuring customers of its profitability.

But after shares dropped significantly in value the following year, the company was forced to admit it had actually made a near-3bn-euro loss the previous year.

Spain’s Central Government later bailed Bankia out, investing more than 22bn euros to save the failing institution.

In turn, the EU was then forced to intervene to save Spain’s banking sector.

 

Short URL: http://www.canarianweekly.com/?p=45259

Posted by on Jan 4 2019. Filed under Local News. You can follow any responses to this entry through the RSS 2.0. Both comments and pings are currently closed.

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