06/08/2012
Spain to create EU mandated 'bad bank' on 24 August
The Spanish government is expected on 24 August to approve the “general outlines” of the structure of the “bad bank” imposed in exchange for a European bailout plan to help its banks, which may acquire up to EUR100bn in assets, the Spanish minister of the economy, Luis de Guindos, announced on 5 August. In an interview with the newspaper ABC, the minister explains that on that date, the government will pass a decree which will lay out most of the commitments established in the Memorandum of Understanding, which was signed with Euro zone partners to secure aid to the banks in late July. “The outlines of the way in which asset management firms, generally known as ‘bad banks,’ will be included,” he explains. The decree will also lay out “a new regulation on sales of complex products, such as preferential stakes,” high-risk products which were sold to hundreds of million of small savings investors in Spain.
