Litany of woes that placed Spain at heart of debt crisis
She hasn’t yet transferred her money to another bank because she doesn’t “want to make things worse for the other clients”. But she’s considering changing to a French or German bank with branches in Spain.
While many Spaniards resent Germany and the austerity measures they believe it is imposing on their government, some also look to the north of Europe with envy, if not admiration.
“The way people behave in the north [of Europe] is different to how we behave here,” says José Roldan, a retired civil servant, as he left a branch of Bankia. Now 71, he has been a client for 50 years of one of the banks merged into Bankia. He wants to see the politicians and bankers who have mismanaged the financial system go to jail, but he also blames the Spanish way of life for the crisis.
“We like the good life and spending money on things,” he says. “And so do our governments.”
Economist David Gomez points out that, like Spain, many other European nations have put public funds into their banks. But the credibility of the Spanish authorities has been undermined by the timing of their actions, he says. “The problem in Spain is that [the bank clean-up] has been very late,” he says. “This crisis in the financial system started in 2008, and at that point the Bank of Spain was saying, ‘We have the best financial system in the world’. And four years later we discover the system needs all this help.”
Bankia’s parent company, BFA, revealed this week it had posted losses of €3.3 billion in 2011, rather than the €40 million profit it had initially announced, further shaking public confidence in the banks.
On Monday, as Spain’s borrowing costs rose to dangerous levels, prime minister Rajoy insisted in a press conference that he will not be requesting a bailout of any kind from the EU. But that has not stopped the debate in the media and on the street about the possibility of further meltdown, or even an Argentina-style corralito, in which bank deposits are frozen to prevent a capital flight.
Beauty consultant Lorena Lichardi (37) moved to Madrid from Argentina in 2002 precisely because of the corralito crisis. While she thinks a deposit freeze is a possibility, she says Spain is still some way from seeing the kind of economy-fuelled panic she witnessed in her native country a decade ago.
“People still aren’t having to get used to surviving on the minimum yet,” she says. “For a lot of Spaniards, this crisis still just means they can’t have two cars and a nice holiday.”