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Spain: #NoMoreEuros for Bankia

This post is part of our special coverage Europe in Crisis

The Internet in Spain was seething since it was reported [es] this Monday that the government is preparing a plan to inject public money into Bankia, the fourth largest bank in the country and the most exposed to the real estate market. Since the crisis started in 2008, the government has supported Bankia with 33 billion euros [es]. The current bail-out plan could be as much as 10 billion.

The news circulated the same day that the the resignation [es] of the head of the financial institution, Rodrigo Rato, was announced. Rato also served as an economy minister in Aznar's government and as president of the IMF (International Monetary Fund). Rato had been two years in management, first in Caja Madrid and then in Bankia, which was formed in 2010 from a merger of seven saving banks.

For his work, he received 2.34 million euros last year and, and for resigning, he is entitled to an indemnity of 1.2 million. His proposed successor is José Ignacio Goirigolzarri, who left the BBVA group (Banco Bilbao Vizcaya Argentaria) in 2009 in exchange for an annual life pension [es] of over 3 million euros.

“Bankia, the rats are jumping ship,” the blog Salmón wrote in an article that has circulated throughout the web [es]:

Rato no se marcha sin más. El botín en versión indemnización al que tiene derecho alcanza la escalofriante cifra de 1,2 millones de euros. Y perdonad mi inocencia pero esta es una de las cosas que no alcanzaré a entender jamás: llegas a una caja quebrada, haces una gestión pésima que la aboca a una situación aún peor, cuando todo se vuelve negro te marchas, le cuestas a los españoles prácticamente lo mismo que los recortes en Sanidad y Educación, y encima te llevas una indemnización millonaria en el bolsillo.

Rato is not walking away just like that. The plunder in form of indemnity to which he is entitled reaches the staggering figure of 1.2 million euros. And forgive my naivety but this is something that I will never understand: you arrive at a broke bank; you manage it dreadfully, which only makes the situation worse; you leave when everything looks grim; you cost the Spanish people practically the same as the cuts in Health and Education; and to top it all off you walk away with a millionaire's indemnity in your pocket.

The community's reactions were immediate and have come one after the other throughout the week. #NiUnEuroMas (#NoMoreEuros) and #Bankia are two of the hashtags that Spaniards are using to express their opinions. The reasons for their anger are many.

Bankia, according to what the website Madrilonia.org recalls in an entry titled “Cuando las ratas huyen de Bankia es hora de tomar Bankia”  [es] (When the rats are fleeing Bankia it is time to take Bankia), is the bank with the highest amount of mortgages in the Community of Madrid and one of the most involved in evictions of families that can no longer pay them:

Caja Madrid y ahora Bankia han ido creciendo con nuestro dinero: nuestros ahorros, nuestras hipotecas, nuestras pocas acciones y ahora, directamente, con nuestras casas robadas en desahucios -Bankia es uno de los bancos con más desalojos- y con dinero público. Ya se han lanzado propuestas de nacionalización -ya que pagamos todo, pues, oiga, que los dividendos no se lo lleven otros.

Caja Madrid and now Bankia have been growing with our money [es]: our savings, our mortgages, our few shares and now, directly, with our houses stolen in evictions -Bankia is one of the banks with the most evictions [es]- and with public money. Proposals have already been made for nationalization [es] -Since we pay for everything, well, hey, let's keep others from taking the dividends.

Many of the tweets denounce the fact that the sum of the anticipated bail-out is more than what is going towards Education and Health in the public budget and is equal to the cuts carried out in both sectors.

These are some of the tweets that have shown up on the web since last Monday. As always, the criticisms are seasoned in many cases with humor:

LoveWillTearUsAznar ‏@lwtuaznar: ¿Y vender chandals para ayudar al rescate de Bankia? ¿Cómo lo veis? Son muy guapos http://pic.twitter.com/4b00MpRf

LoveWillTearUsAznar ‏@lwtuaznar: Selling track suits to help pay for the Bankia bail-out? What do you think? They look really nice http://pic.twitter.com/4b00MpRf

Dark Vader ‏ @pistatxin78: #Bankia, ¿Por qué pides sólo 10.000 millones? Pide 14.000 y ya lo amueblas…. http://pic.twitter.com/M5TinsNI

Dark Vader ‏ @pistatxin78: #Bankia, Why are you only asking for 10 billion? Ask for 14 and you can get new furniture…. http://pic.twitter.com/M5TinsNI

"Why are you only asking for 10 billion? Ask for 14 and you can get new furniture."

"Why are you only asking for 10 billion? Ask for 14 and you can get new furniture."

Raul Gonzalez ‏ @Raulexio: #Bankia ¡¡¡¡¡ Manos arriba, esto es un atraco!!!!!

Raul Gonzalez ‏ @Raulexio: #Bankia Hands up, this is a hold-up!!!!!

Jose Sanclemente ‏ @josesanclemente: ¿cuanto IVA hemos de pagar, cuantas recetas y camas de hospitales, cuantas aulas se han de cerrar…para darle 10.000 millones a Bankia?

Jose Sanclemente ‏ @josesanclemente: How much VAT do we have to pay, how many prescriptions and hospital beds, how many classrooms have to be closed… to give 10 billion to Bankia?

Pilar Marroyo ‏ @pilar_marroyo: El gobierno rescata a Bankia y sus directivos millonarios, ¿qué dirán los que han visto hundirse sus negocios sin nadie que los ayudara?

Pilar Marroyo ‏ @pilar_marroyo: The government is rescuing Bankia and its millionaire executives, and the people whose businesses went under without anyone to help them, what would they say?

Joan Baldoví i Roda ‏ @joanbaldovi: Presupuesto educación + sanidad en 2012: 5.397 millones de euros. Rescatar Bankia: 7.000 millones de euros #hagamoscomoislandia

Joan Baldoví i Roda ‏ @joanbaldovi: Health+education budget in 2012: 5.397 billion euros. Bailing out Bankia: 7 billion euros #hagamoscomoislandia (#DoAsIcelandDid)

Toret @Toret: #HagamoscomoIslandia. Ni un euro más para los bancos, juicio a los culpables de la crisis y una constitución escrita por los ciudadanos!

Toret @Toret: #HagamoscomoIslandia. (#DoAsIcelandDid) Not one more euro for the banks, let's take the ones responsible for the crisis to court and make a constitution written by the people!

Ángel ‏ @A_Cas: Si Bankia vale en bolsa unos 3.000 millones y se le inyectan 8.000 ¿no es de facto pública?

Ángel ‏ @A_Cas: If Bankia is worth about 3 billion and they inject 8. Isn't it really public then?

Jéssica Remón ‏ @jess_rr: Recortes en educación y sanidad: 10.000 millones de €; rescate a Bankia: 11465 millones de euros, pero ¿ésto que es?? #NiunEuroMas

Jéssica Remón ‏ @jess_rr: Budget cuts in education and health: 10 billion €'s; bailing out Bankia: 11.465 billion euros, Wait… What is going here?? #NiunEuroMas (#NoMoreEuros)

Mrs. ∞ ßϒξn ‏ @bren_oo7: #NiUnEuroMas Habrá que volver a guardar los millones bajo el colchón de la cama…están mas seguros que bajo 3 cajas fuertes en un banco.

Mrs. ∞ ßϒξn ‏ @bren_oo7: #NiUnEuroMas  (#NoMoreEuros) We'll have to go back to hiding the billions under our mattresses… they're safer there than in 3 safes in a bank.

Renta Básica ‏ @Renta_Basica: Si se repartiera el rescate de Bankia entre TODOS los desahuciados tocaría a + de 20.000€ por familia #ConElDineroDeBankia#NiUnEuroMas

Renta Básica ‏ @Renta_Basica: If the money meant for bailing out Bankia were distributed among ALL the evicted people it would be more than 20,000€ per family #ConElDineroDeBankia#NiUnEuroMas (#WithBankiasMoney) (#NoMoreEuros)

Peich ‏ @_Peich: La inyección que necesita #Bankia es la letal.

Peich ‏ @_Peich: The only injection that #Bankia needs is a lethal one.

Miquel Roig ‏ @miquelroig: Ejem… Según #BFA, #Bankia vale 24.000 millones. Según #Deloitte, vale 17.000 millones. Según el mercado: 4.300 millones

Miquel Roig ‏ @miquelroig: Ahem… According to#BFA, #Bankia is worth 24 billion. According to #Deloitte, it's worth 17 billion. According to the market: 4.3 billion

The journalist Ignacio Escolar outlined the numbers in a post in his blog, Bankia's deficit in five easy-to-understand figures [es]:

4.600 millones de euros. Es lo que vale Bankia, según su capitalización bursátil de ayer. Es decir: los mercados valoran a esta entidad financiera en un tercio de lo que el Estado tendrá que poner para reflotarla a ella y a su matriz, el BFA, que es una especie de banco malo donde el genio financiero de Rodrigo Rato –aconsejado por MAFO– dejó toda la basura del ladrillo para ver si así podía aguantar. En ese almacén nuclear se guardan 30.000 millones en activos tóxicos, un 3% del PIB nacional o todo el recorte del gasto público de este año. Dentro de esa cifra hay también 5.000 millones en suelo, un patrimonio que se ha devaluado aún más. Es obvio que el dinero público prestado difícilmente va a regresar.

4.6 billion euros. It's what Bankia is worth according to its stock market capitalization yesterday. That is to say: the markets value this financial institution at a third of what the government would have to put in to keep it and its parent company, the BFA, afloat. The BFA is a type of bad bank where the financial genius Rodrigo Rato, advised by Miguel Ángel Fernández Ordóñez, left all the construction trash to see if people could put up with it. 30 billion toxic assets, 3% of the nation GDP is kept in that nuclear warehouse or all this year's cuts from public spending. Also within that number figure about 5 billion in land, a patrimony that has depreciated even more. It is obvious that the borrowed public money will be difficult to return.

The conservative Catalan newspaper La Vanguardia has started an online survey [es] in which it asks its readers if they approve of injecting public money to compensate Bankia. After 3,243 people responded, 94% said no.

This post is part of our special coverage Europe in Crisis

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