Most of the news media have been following the Blesa case conservatively and in line with the PP's agenda, but elEconomista has doggedly pursued details of the case that shed light on Caja Madrid's shady purchase of City National Bank of Florida in 2008.
Last Saturday we learned that Miguel Blesa, Caja Madrid's former president, overvalued CNB worth by 544 million euros before his bank purchased it. And now it has been made known that the United States Treasury's 2010 report on CNB was looked at after the Bank of Spain's inspection, and it is an excellent. document.
The US Treasury indicated that CNB's management was divided and riddled with internal conflicts. It showed how the bank's management was failing and not able to see how its shares would fall in value as the US economy crumbled. The report criticizes the meetings that the CNB's board held and argues that the bank's management performed below industry standards.
But the most serious reproach calls out Blesa, accusing his management practices as "bad" and "incompetent." Now we know that Blesa sidestepped the rules, picked a bad time to buy CNB, paid way too much for the bank, ignored the Bank of Spain's reccommendation (it opposed the deal) and that his overall management could have been much better. In March of 2010, Caja Madrid needed a 75 million euro injection to stay afloat. The real question: why did Blesa buy a bank that nobody seemed interested in managing properly?
