@chris McCarthy wrote:
They will hold that stock for 10 years if they have to, and no government or even IMF is going to change that.
Have a read of this article.
Spanish banks are being forced to reduce the asset values of repo property. The Bank of Spain has also forced them to increase capital reserves. They can only do that from either requesting it from shareholders, selling off assets or having a moratorium on all lending thereby building reserves from deposits. The final option will simply prolong the slowdown.
In Basel this weekend the committee overseeing banking regulation seem to have come to a decision that will force banks to provide even greater capital reserves.
I therefore think asset sales are more likely together with some further shareholder investment.
Releasing for sale massive capital stocks on an already flooded market will deflate the market further. However if prices fall far enough investors will return. The degree of risk is less.