Some headlines from Spain, confirming that the buck did not end with Dexia, and that another bank which accounted for 0.74% of total Spanish assets has just folded. For now it is just the smaller ones. Soon, it will be the bigger ones.
- DJ Bank Of Spain Takes Over Banco De Valencia
- DJ Banco Valencia Has 0.74% Of Spain's Total Bank Assets
- DJ Bank Of Spain To Grant Up To EUR2B In Loans Tp Banco De
- DJ Bank Of Spain To Inject Up To EUR1B In Banco De Valencia
And the same from Bloomberg's perspective.
- BANK OF SPAIN REMOVES BANCO DE VALENCIA MANAGEMENT :BVA SM
- BANCO DE VALENCIA COULDN'T TAKE STEPS TO ENSURE VIABILITY
- FROB TO GIVE BANCO DE VALENCIA EU2 BLN CREDIT LINE :BVA SM
- FROB TO SUSCRIBE UP TO EU1 BLN OF BANCO DE VALENCIA CAPITAL
- SPAIN RESCUE FUND FROB TO ADMINISTER BANCO DE VALENCIA :BVA SM
Who is next?
And here is Peter Tchir's take:
If Dexia was Europe's Bear Stearns, what is Banco de Valencia? Maybe there will be one per country? Maybe the whole thing doesn't end until some banks actually default. Letting Lehman default was probably one of the good things that happened and the only reason we talk about double dip rather than having remained mired in a deep recession. Defaults need to occur to clean up the system, to let politicians (as scary as that is) to target money and liquidity to where it can do the most good. We learned the wrong lessons from Lehman and are encouraging Europe to make the same mistakes. Had Greece defaulted a year ago, do you really believe we would be in worse shape now, than we are? So maybe Greece was Europe's Bear Stearns?