CNV

Brussels, 12 May 2011 – Given the situation of the savings and mutual banks in Portugal and Spain and in line with the ratification of the WOW resolution adopted in Cyprus in 2010, we as WOW make a call to defend all financial institutions with a social character in both countries as well as throughout Europe.

Portugal requested funds for a bailout (about 90 billion euros) after interest rates collapsed the economic system while rating agencies listed Portuguese financial institutions as "junk bonds." Faced with this situation, mutual banks are forced to merge into large banks that eliminate the participation of society. Also worrying are the intentions announced by the opposition to privatize the state bank that already saved private banks with a bailout of 5 billion euros of public funds.

In Spain, the law 2/2011 of 18 February, which requires to raise additional equity for the savings and mutual banks above those imposed on Spanish and European banks, is causing a restructuring of the mutual and savings banks, which are being forced to become banks while they are entities that for over 150 years have been playing an important role in regional economic development and providing a great social work, promoting that modest citizens are not financially excluded.

This social “expropriation”, which will deprive the society of social investments that in the past six years exceeded 7 billion euros and that, in future, will go to the private pockets of shareholders, reflects the fact that the people are to serve the economy while the economy should serve the people.

Originated by legislative changes made by the Government and the Spanish Parliament, these changes are leading to privatization, eliminating the representatives of the society in its management, leading to ‘banking’ - seeking economic returns above the social -and turning them into "limited companies" with all the impact these changes will have on society, not just because of the loss of jobs (which now already exceeds 14,000), but also because of changes in their important social functions.

The WOW expresses its total rejection of economic powers that make a link to the forthcoming rescue of Spain. The Spanish economy is solvent but the rescue of Portugal, with the restrictions it will impose, will clearly hurt the Spanish economy which in recent years has invested heavily, giving the unrealistic reason to private rating agencies to begin a new attack on Spain.

WOW also expresses its desire that the financial system both in Portugal and Spain maintains its entities related to the society, and that, in Spain, savings and mutual banks remain with their historical legal personality, that they can continue their Social Work to the benefit of society, that those who have led the savings and mutual banks to the current situation (the Bank of Spain and the directors of the Banks) are held accountable and that the thousands of jobs that the employers want to eliminate, are kept. The global crisis cannot be an excuse to cut social rights and eliminate jobs. The million "bonus" given to CEO’s of large companies and financial institutions should also be eliminated.

WOW also expresses its full support to the legal, policy and information actions carried out by the unions ASIPA, FEC in Spain and STEC in Portugal.