Spain: the merger of savings banks is accelerating .

The head of the Savings Bank of the Mediterranean in Alicante.Keywords: Finance Iberian, SPAIN, CAM, Cajastur, Caja Cantabria, Caja Extremadura.

Four regional banks announced their merger: the Savings Bank of the Mediterranean (CAM, based in Alicante), Cajastur (Asturias), the Caja Caja Cantabria and Extremadura.

Worried about the health of regional banks Spanish markets precipitated the financial sector reform and Portugal. After the rescue Cajasur surprised by the Bank of Spain, last weekend, the merger of savings banks is accelerating. Four regional banks announced Monday the merger: the Savings Bank of the Mediterranean (CAM, based in Alicante), Cajastur (Asturias), the Caja Caja Cantabria and Extremadura.
The new structures will assemble 135 billion euros of assets and financial entity will be the fifth of the country, behind bank Santander, BBVA, La Caixa and Caja Madrid. This merger is a direct consequence of the Chagrin Cajasur, rescued from bankruptcy by Bank of Spain, through an investment of 500 million euros because Cajasur had refused to merge with Unicaja.
The crisis of Spanish savings banks in the crosshairs of markets for several months because of the housing crisis, illustrates the particularities of the local financial system. Besides the big banks as Santander and BBVA, live 45 savings banks, each located in a region or a specific department. A minority of its private structures, such as the Caixa Cajamadrid or play in the international financial arena, but all observe different rules from those imposed on banks.
The "cajas" enjoy tax benefits and must repay a portion of their profits as shares of public utility. Above all, they are controlled by local political powers, the majority parties in each region of people placing their trust in the boards of directors.

Eliminate the black sheep:
These local institutions generally enjoy a reputation among their clients traditionally individuals and SMEs. But the building boom of the last twenty years has encouraged them to invest in the stone. The bursting of the bubble strikes with full force today.
"Too many officials in the Spanish financial system," says Nuria Alvarez Renta 4 analyst manager. There is no market for everyone and third entities should disappear. Mergers can create groups capable of competing banks. "
The Spanish authorities attempt to encourage movement through the Bank of Spain and Bank Restructuring Fund ordered (Frob), a tool created in 2008 and has 9 billion. But Brussels has asked the disappearance of this facility June 30, 2010. Madrid pressed once again by its partners, therefore attempts to accelerate the merger process before the deadline.
The restructuring, which aims to strengthen the financial system, eliminating the "bad apples", are struggling to convince the markets. Yesterday, the Ibex 35 fell to its lowest level this year. And Spain had put its debt at record prices of 0.65% (against 0.52% last month) for securities to three months and 1.27% (instead of 0.74%) for those placed at six months. "The markets fear that these mergers do not show an exhibition of Spanish financial system to the property sector more than expected," says Nuria Alvarez.