Priest cum Chairman of Spanish Bank CajaSur prays as bank gets seized

The State of  Management of some of the European banks would seem funny  if it was not such a serious matter.According to Bloomberg ,Bank CajaSur which has almost 1% of Spain’s total bank assets was run by the Catholic Church.The new chairman whose primary job is that of a priest started his chairmanship by reading a prayer while his bank reported $750 million in losses.There are 16 such large mutually owned banks called Cajas in Spain which have no shareholders and are run it seems almost amateurishly.They had a good run when the whole Spanish economy was Booming through a Real Estate  fueled Speculation . However they have run into solvency issues  in the current 20% unemployment scenario.German Landesbanks are also facing huge NPAs with heavy exposure to toxic assets.

CajaSur Seizure Marks Change for Spain’s Ailing Banks – Businessweek

As a Roman Catholic priest, Santiago Gomez Sierra began his last board meeting as chairman of the failed Spanish savings bank CajaSur three days ago by saying a prayer. Some of the directors crossed themselves.

Within hours, the Bank of Spain stripped Gomez of his powers and threw out managers at the ailing 146-year-old lender, controlled by the Catholic Church in the southern city of Cordoba, citing “viability problems.” CajaSur lost 596 million euros ($748 million) on 426 million euros in revenue last year.

The Bank of Spain is stepping up efforts to shut down or buttress the weakest of Spain’s “cajas,” mutually owned banks that boosted lending more than fivefold during Spain’s economic boom and account for about half the country’s loans. The seizure is the first under a state-financed rescue plan that Standard & Poor’s estimates may cost as much as 35 billion euros, increasing the burden on Spain’s finances as the government tries to reduce its budget deficit.