Cajas Closures Will Leave 4.8 Million Spanish Without Local Branch

The General Workers’ Union (UGT) has complained that the restructuring of the savings banks will leave 4.8 million people with no bank branch in their area. The union estimates that 2,656 villages, which at present only have savings banks, will be left without any bank branches, which would mean financial exclusion for 4.8 million Spanish people, some 12.68% of the population.

The Secretary General of the Federation of Services for the organisation, José Miguel Villa, has insisted that the demands of Brussels will accelerate the closures “forcing people to go to other towns or cities to solve their banking needs”. Villa also commented that the memorandum will lead to the end of the Cajas, “of which only two will remain, Ontinyent and Pollença, because the rest are banks,” he said.

During the presentation of a study on the financial system they have demanded the creation of a public banking group “with the more than 150,000 million euros of taxpayers’ money that has been used in the conversion of the financial sector, to return the credit flow to Spain and revive the country.”

The report shows that between 2008 and March this year 30,172 jobs in the banking sector have been lost and more than 5,700 offices have been closed. However, the organisation has warned that the restructuring process will continue after the terms of the bailout have been made public.

El Pais reported that they have predicted that pending mergers will result in 5,000 further layoffs: “Between Unicaja and Caja España, 1,800 people will go, with the purchase of Unnim and BBVA, 1,300, and between the Sabadell and CAM, 2,200 more. Then, when the restructuring progresses 10,000 workers may go.” “UGT would ask that any process be done in an orderly, negotiated way respecting the channels of the banking and savings banks agreements signed last year,” they underlined.

On the other hand, Villa has said that the road proposed by the EU to overcome the crisis “is that of the destruction of countries, as there has been no single economic measure or policy that has calmed the markets.” In the same critical tone he denounced the process of selling much of the banking sector “at low cost. We understand that the sector needs restructuring, but not liquidation of the savings banks.”

Regarding the union’s responsibility in the sector’s fiasco, Villa said that of the 636 people that form the boards of the savings banks, “only 10 represent the UGT, so that the organisation holds only 2.2% of responsibility in the fiasco that has occurred in the financial sector.” Villa stated that “there are shared responsibilities at all levels”, and emphasised that no operation was carried out without the regulation and approval of the Bank of Spain, the National Securities Market Commission (CNMV) and the various Ministers of Economy.

“All the entities that made restructuring processes developed feasibility plans which were initially fabulous and which are now proving not to be so,” stressed the Secretary General of the Federation Service, and said “all the regulators failed and have responsibility in this matter.”

The union also stressed that “it is not enough that the State Attorney General takes action over the leadership of Bankia, but must prosecute all entities that formed the bank.” On the new cuts approved by the Government to reduce the state deficit, Villa expressed his “total readiness” to support any actions that will develop the union.

In his opinion, the solution is a large public bank with nationalised entities. “In total, the state has committed 150,553 million euros from loans, equity and guarantees. I think it’s fair to revert to a public bank that gives loans to SMEs and families because otherwise we will never get out of the crisis.”