SPAIN’S Prime Minister Pedro Sanchez has backed a merger between two Spanish banks and urges to to consolidate
Spain News: Prime Minister Sanchez backs Spanish Bank Merger: Spain’s Prime Minister Pedro Sanchez today announced there were positive aspects in the proposed merger of Spanish lenders Caixabank and Spanish state-owned Bankia. And urged on the banking sector to take steps to consolidate further.
“From the perspective of size, the Spanish financial sector has to take steps forward,” Sanchez said in an interview on Spain’s TVE. television station.
The two Spanish banks are set to agree a merger to create Spain’s biggest domestic lender in the next few days. In a deal expected to lead to hefty job cuts in Spain’s banking sectors.
Since the end of Spain’s 2008 financial crisis, the number of major lenders in Spain has dropped to 12 from 55. But regulators see more scope for mergers as a way to cut rising costs.
The deal is likely to raise tensions within the Socialist-led coalition government as the left-wing Unidas Podemos has in the past floated the idea that Bankia should remain state-controlled to better serve the interests of taxpayers.
Sanchez once again said today that the government’s aim was to maximize the value of the state’s stake in Bankia.
Bankia was bailed out in a 22.4 billion euro state rescue in 2012. At the height of Spain’s financial crisis, and so far it has returned only 3.3 billion euros of the state aid.
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