{"id":24136,"date":"2017-06-11T19:28:06","date_gmt":"2017-06-12T00:28:06","guid":{"rendered":"http:\/\/olduvai.ca\/?p=24136"},"modified":"2017-06-11T19:28:06","modified_gmt":"2017-06-12T00:28:06","slug":"is-another-spanish-bank-about-to-bite-the-dust","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=24136","title":{"rendered":"Is Another Spanish Bank about to Bite the Dust?"},"content":{"rendered":"
\n

Is Another Spanish Bank about to Bite the Dust?<\/a><\/h3>\n<\/header>\n
\n
\n
Stockholders and junior bondholders fear a <\/strong>\u201cbail-in.\u201d<\/strong><\/div>\n<\/div>\n

After its most tumultuous week since the bailout days of 2012, Spain\u2019s banking system is gripped by a climate of fear, uncertainty and distrust. Rather than allaying investor nerves, the shotgun bail-in and sale of Banco Popular<\/a> to Santander on Tuesday has merely intensified them. For the first time since the Global Financial Crisis, shareholders and subordinate bondholders of a failing Spanish bank were not bailed out by taxpayers; they took risks in order to make a buck, and they bore the consequences. That\u2019s how it should be. But bank investors don\u2019t like not getting bailed out.<\/p>\n

Now they\u2019re worrying it could happen again.\u00a0As Popular\u2019s final days showed, once confidence and trust in a bank vanishes, it\u2019s almost impossible to restore them.\u00a0The fear has now spread to Spain\u2019s eighth largest lender, Liberbank, a mini-Bankia that was spawned in 2011 from the forced marriage of three failed cajas<\/em>(savings banks), Cajastur, Caja de Extremadura and Caja Cantabria.<\/p>\n

This creature\u2019s shares were sold to the public in May 2013 at an IPO price of \u20ac0.40. By April 2014, they were trading above \u20ac2, a massive 400% gain. But by April 2015, shares started sinking. By May 2017, they were trading at around \u20ac1.20.<\/p>\n

But since the bail-in of Popular, Liberbank\u2019s shares have seriously crashed as panicked investors fled. Scenting fresh blood, short sellers were piling in. On Friday alone, shares plunged another 17%. At one point, they were down 38% before bouncing at the close of trading, much of it driven by the bank\u2019s own share buybacks:<\/p>\n

\"\"<\/p>\n

In the last three weeks a whole year\u2019s worth of steadily rising gains on the stock market have been completely wiped out. The main causes of concern are the bank\u2019s high risk profile and low coverage rate.<\/p>\n

…click on the above link to read the rest of the article…<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

Is Another Spanish Bank about to Bite the Dust? Stockholders and junior bondholders fear a \u201cbail-in.\u201d After its most tumultuous week since the bailout days of 2012, Spain\u2019s banking system is gripped by a climate of fear, uncertainty and distrust. Rather than allaying investor nerves, the shotgun bail-in and sale of Banco Popular to Santander […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[46,13915,52,15380,15382,15384,15383,5660,15381,9280,743],"class_list":["post-24136","post","type-post","status-publish","format-standard","hentry","category-economics","tag-bail-in","tag-banco-popular","tag-bank","tag-bank-crisis","tag-cadaster","tag-caja-canatbria","tag-caja-de-extremadura","tag-don-quijones","tag-liberbank","tag-santander","tag-spain"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/24136","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=24136"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/24136\/revisions"}],"predecessor-version":[{"id":24137,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/24136\/revisions\/24137"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=24136"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=24136"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=24136"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}