Banks Force Spain To Cancel Its Biggest IPO Because It Would Take Money Away From Banks

Its is quite stunning that what would have been Spain's biggest ever IPO was cancelled due to bank pressures as they were afraid people would take money away from their coffers to buy the IPO shaes..

The ruling Socialists abruptly cancelled plans to boost public coffers by selling part of the state lottery for up to 9 billion euros (US$12 billion), "under pressure from the centre-right opposition party and banks fearing they would be choked of funds, market sources said" (Reuters) .
The IPO was fiercely opposed by Spanish banks involved in the sale, Santander and BBVA , which saw Loterias as a "direct rival to their need to bolster capital, by attracting would-be investors away from their deposits".

"I know for a fact that pressure from the banks involved is the reason behind this decision. The banks need capital to shore up their balance sheets and Loterias was direct competition. It would have attracted investors who would otherwise have opened deposits which the banks badly need," said a fund manager at one of Spain's largest institutions".