Why A Spanish Banking Crisis?

More than enough people have been asking why and how the Spanish banks got in to such a state that they needed another bailout. Well, I can tell you from personal experience that one of the reasons is massive inefficiency.

My wife and I had cause to go to the S……… bank in Marbella to send money to a friend in Romania, and I was appalled at the sheer inefficiency of the service. If you wish to send money outside the country to someone who does not have a bank account of their own, you can only do it from certain banks, and then only if you have an account with them. In our town the only one that would do it without us having an account is the one ‘mentioned’.

We regularly send money to Romania, but to do it I have to show my passport and give them the special code of the place where the money is to be sent, one of the most popular being a Western Union office. A couple of years ago my details were entered into the banks computer and we made the transfer. Last year I had to renew my passport, but instead of just being able to update my information I found they had deleted it all. So with the new passport I had to start from scratch, meaning we had the approval process of one month to go through again. More time wasted. This finally worked for a short time, but when we went back last month they couldn’t find me in their computer again.

We were told that once they had sorted out the problem they would give me a call and we could make the transfer. Guess what? After a month we still didn’t get a call (surprise! surprise!). So off we trotted to the bank again to find out what the hell was going on. After waiting a considerable time, we got to talk to the lady who took another fifteen minutes to find my data, check my documents again and finally fill in the transfer form.

By this time a queue of at least twenty-five people had built up behind us at the cash desk, but we were told we would have to wait in line. If the service had been even adequate, she could have taken the money and we would have been out of there. Instead we spent another thirty-five minutes waiting in the cashier line. There were three positions but only two were manned and the cashiers themselves seemed to know only two speeds, dead slow and stop!  Finally a young man opened up the third desk and things moved to just above a snail’s pace.

To cut this short, it was a very frustrating hour and fifteen minutes waiting around at the whim of a bank that doesn’t have a clue on what the word efficiency means. The money clutched in my hot sweaty little hand waiting to be sent was my money, and on top of that I had the €3 admin fee in my hand as well, so if I am taking my money into the bank, paying their expenses for doing the transfer, why am I given so much hassle???  With most banks, why can I only do if I have an account with them?

I am sure that most people will not believe this but it is a verifiable fact that Spain has 109 different banks, only 9 of which are inter/national. This means that there are 100 regional and spanish city banks. The UK for example has only 9 banks, while France has 24, and these figures include regional banks that come under the main banking groups.

In Spain however, the 109 are independent banks all trying to make money from the Spanish people. Personally I fail to see how such a system has developed, because it seems that apart from the regional banks, cities like Seville, Malaga and San Sebastian all have their own local banks, but it goes down to town level too. To a foreigner it is without doubt a chaotic system especially when you consider that many of the smaller banks do not provide a full banking service at all.

One thing we all need to remember is that the Spanish way of doing things is to say the least, chaotic. The banks in Spain cry about their ‘toxic debts’ and cite that as the reason for the banking crisis. True, there is a massive slump in house purchases and many economic problems over the last three years, but their attitude to solving them is crazy to say the least.

Families who bought property during the ‘good old years’ are being thrown out on the street because they can no longer keep up with their mortgage payments. When this happens the house is repossessed by the banks and is added to the massive number of houses that cannot be sold (currently estimated at 215,000) because no-one can afford them. Surely it makes more sense for these people to stay put and pay off their mortgage at a reduced rate until things get better. In this way at least the banks would have some form of income from their holdings instead of the property standing empty with no-one wanting to buy, and thereby generating no income whatsoever. In our area alone there are places that have been repossessed and are still waiting to be sold after three years. 

There is no doubt in anyone’s mind that Spain is sinking deeper and deeper into crisis and how they are going to extract themselves is still a mystery. It will not change until someone in the government decides that the lazy individuals in the country need to get up off their asses and start working efficiently. Government, local council offices and the law all need a swift kick up the backside and some rapid instruction on how to do things in an efficient and cost-effective manner. Otherwise, I see more dark clouds on the horizon. Don’t get me wrong, this is a great country and most of the people are great, but the leadership and know-how needs to come from the top. For decades this has not been happening because most of those in charge are too busy lining their own pockets. Come on Spain – Get off your backside and start marching forward!

Roy.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.

%d bloggers like this: