The latest monitoring report prepared by the inspectors of the Bank of Spain on the integration process of the Banco Mare Nostrum (BMN) group casts doubt on its viability and even states that it "virtually impossible" to "return the financial support of the FROB."Quick Translation
The supervisor reports that BMN has spiraled out of control.
The report, which was completed on 8 May (three days before the announcement of the second reform of De Guindos) warns that deviations are "very significant".
But the failure to meet targets set in the plan, is not the only thing that is highlighted in the report. Inspectors also note changes in accounting principles, "inflated margins," inadequate risk rating and, an incorrect adjustment to reserves that would have rid the institution of record losses in 2011.
The BMN group, born from the union of Caja Murcia, Caixa Penedes, Sa Nostra and Caja Granada, received in June 2010 915 million preference shares FROB.
The BMN group is bankrupt and it is "virtually impossible" to pay back money to the Fund for Orderly Bank Restructuring (FROB).
Clearly the alleged orderly restructuring process is not so orderly.
For more on the FROB, please see Lending to Peter so Peter Can Lend to Paul
Mike "Mish" Shedlock
Click Here To Scroll Thru My Recent Post List