Premiere for banking union: Banco Popular saved

With the takeover of Banco Popular the Spanish bank Santander has saved its former rival from collapse. New Eurozone regulations on bank resolution foreseeing investor participation were used for the first time in the bailout. Taxpayers were spared. Commentators see the move as a success.

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NRC Handelsblad (NL) /

A promising example

NRC Handelsblad sees the banking union getting off to a good start:

“After the false start in Italy [the bailout of Monte dei Paschi] the Spanish takeover shows how things should be done. The shareholders of the Banco Popular will pay dearly, as will some of the bondholders. But small account holders will be spared, and the Spanish state won't have to fork out either. This doesn't mean the crisis is over. Banco Popular being taken over by another bank and the problems of Italy's Monte dei Paschi only serve to highlight the fact that the Eurozone's banking sector is far from healthy. … Now major steps must be taken to reform the whole sector. The economic upswing will aid this process.”

Cinco Días (ES) /

Successful test run

The Banco Popular bailout makes the European banking union look good but also highlights the past mistakes of the bank's management, Cinco Días comments:

“This is a new kind of surgical operation, one that is swift and doesn't cost the taxpayers a penny in a country like Spain which has already invested the princely sum of 42 billion euros in restructuring its savings banks. … This express bailout is the first example of the advantages of the European banking union. … At the same time this successful test run is the consequence of an experiment that went terribly wrong, because for a long time the Banco Popular was saddled with the same kind of risks as other failed banks. It tried to solve the problem in its own way, behind the back of its shareholders, and failed.”