Don’t forget about Spain

With all the news out of France and Greece, let’s not forget about the situation in Spain. While posting this, Mr Rato is resigning as Bankia Chairman. From El Pais.

The Bank of Spain and the Economy Ministry are finalizing a profound reorganization plan for troubled lender Bankia, which includes using money raised through the sale of public debt as passed in a February decree, to keep the banking group from going under because of the exorbitant amount of bad real estate loans it holds.

Market sources said on Sunday that Bankia and its parent, Banco Financiero y de Ahorros (BFA), which holds most of the troubled loans, could need anywhere between five to 10 billion euros to clean up their problematic assets from the property sector.

The bank’s financial portfolio shows more than 31.8 billion euros in slow-paying loans and defaults. Full reading here.