• 10-N. Hard punishment to the Ibex and the banks in stock market

Talking about doubts among investors after the government agreement announced on Monday between Pedro Sánchez and Pablo Iglesias may be too prudent due to the stock market bleeding that the banks have suffered after knowing the pact between the two. Specifically, the entities present in the Ibex 35 have lost 6,200 million euros in the last two sessions, dragged by the uncertainty generated by the measures that the hypothetical new Executive could implement.

"The markets are discounting the measures that the new Government could apply in response to its electoral programs," explains Darío García , an analyst at XTB.

Measures that would fully impact the sector and that would add to the effects that the current context of negative interest rates promoted by the ECB is already having on the entities. Among other things, the formation of Pablo Iglesias proposed in his electoral program to establish a bank tax "that increases the tax rate of financial entities by 10 points in Corporate Income Tax to recover the bailout of 60,000 million euros" or impose "a fee to the banking sector for financial inclusion [of the smallest populations] managed by Bankia, to guarantee them a package of basic services".

To this would be added a "corporate tax reform regarding the taxation of large corporations" -which would also fall on banks- or the introduction of a tax on financial transactions, the so-called 'Tobin rate', which also includes the Socialist Party. Said rate would levy the purchase operations of Spanish shares with 0.2% and, therefore, would make the transactions more expensive.

With this starting scenario, investors prefer to leave bank securities, hence their collapse in the Ibex. Yesterday, Bankinter fell 3.74%, followed by Santander (--3.49%), Bankia (-3.38%), BBVA (-3.25%), Sabadell (-2.99%) and CaixaBank (--2.12%).

But the collapse is much greater if losses are added since Tuesday. Only Santander has left 2,800 million euros of the value of its capitalization along the way, compared to 1,246 million BBVA or 966 million CaixaBank. For its part, the capitalization of Sabadell has fallen in these two days by 315 million; that of Bankinter, in 296 million and that of Bankia, in 296 million euros.

The future of Bankia

The entity chaired by José Ignacio Goirigolzarri is the one that generates more concern and uncertainty among the markets and investors. The State, through the Frob, has a somewhat greater share of 60% in its capital and has yet to face its privatization process after the rescue of 2012.

It is true that both the Government of Mariano Rajoy and Sanchez during the last legislature have been postponing this operation for not finding the most favorable conditions to minimize losses. However, the presence of Unidos Podemos in the Government could call into question the privatization itself, taking into account that the party wants to maintain the ownership of the State in the entity and convert it into a public bank .

Just look at point 79 of your electoral program, which unambiguously promotes "preventing the imminent privatization of Bankia." "We must now take advantage of this resource to introduce competition in the sector, ensure that the most productive and dynamic elements of our system have access to credit, introduce parameters of justice in the mortgage market and address the social functions of banking than other entities they neglect, as cashiers in the emptied Spain or investments in social housing, "picks up his proposal.

"It is also a concern that United We can contemplate merging Bankia with the ICO to enhance the granting of credit, which would increase the delinquency of the bank, lead to worse results and higher provisions," says Darío García.

All these are still conditional plans, in the absence of clearing several fundamental unknowns. To begin with, if PSOE and United We can get the rest of the support they need to form the Executive and then, in case they succeed, what role will the current Minister of Economy, Nadia Calviño , who has so far been in favor of Wait for a better time to sell the company.

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