I’m interested to hear from those who can explain more about the situation of Spanish savings banks (Cajas) having their capital locked up with dead money as they have been foreclosing on mortgages and developers.
I’ve been advised that around 50% of the Spanish banking industry now owns about 50% of the unsold property in the country, which they are holding back from the market so as not to cause a glut and have to declare enormous losses. How accurate is this?
The media describes the amount required to resolve the problem as anything from 20-60 billion EUR but the state cannot find that sort of money without getting into the same situation as Iceland, Greece or Ireland.
I’m told that the government is forcing the Cajas to merge into large listed (insolvent) entities and seek new capital on the open market. But who is going to invest in the bankrupt Cajas?
Will the banks be forced to sell out for peanuts and everything gets dumped on the open market?
I am told that all of the banks, including the Cajas, have set up companies to market their properties.
Interested to hear from those who know far more on this and the anticipated consequences.
