Spanish cajas, their bailouts and their restructuring may provide lessons for other countries with some government ownership of banks. This is the conclusion of an article in July’s edition of Public Money and Management.
The article, Public corporate governance of state-owned enterprises, takes a detailed look at the Spanish banking industry and the state owned cajas which represent half of the sector.
The banks have multi-level governance arrangements with numerous different stakeholders that they are accountable to. The paper suggests that the differing objectives of these stakeholders, which include central government, local government and municipal corporations, leads to difficulties in restructuring or modernising the banks.
July’s edition of Public Money and Management also includes an article on how, despite a complicated political system, a general election and a coalition formation period which spent a large amount of time concentrating on state reform rather than fiscal measures, the Belgian government has largely managed to pull the country out of recession.
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