MADRID, March 15 (Reuters) - The Bank of Spain’s former governor denied responsibility for the failure of now state-controlled Bankia’s stock market listing and said he was unaware of warnings from his inspectors, the lawyer who brought the case and was present at a court hearing said on Thursday.
Spain’s High Court placed Miguel Angel Fernandez Ordonez and five other current and former central bank officials under investigation in February over their roles in the ill-fated 2011 listing of Bankia, which was nationalized the year after with a 22.5-billion-euros ($24 billion) bailout.
Hundreds of thousands of retail investors who bought into Bankia’s listing saw the value of their shares almost completely wiped out as a result of the bailout at the height of Spain’s banking crisis, triggering lengthy legal action.
In its February ruling, the High Court said there was evidence linking the officials to “criminality”, after investigators studied emails from Bank of Spain inspectors who had warned against giving Bankia the go-ahead to float.
Fernandez Ordonez, who stepped down from the Bank of Spain in 2012, said at Thursday’s hearing he did not receive the emails from inspectors, the lawyer who brought the case, Andres Herzog, said on Thursday.
“(He) blamed the recession, the international financial crisis, and other external circumstances, and said an additional defect was the lack of regulation,” Herzog told reporters after the hearing which was closed to the press.
Herzog said Ordonez told the court that the system was not prepared for such a crisis, which he compared to “an earthquake.”
Fernandez Ordonez’s lawyer Bernardo del Rosal did not reply to a request to comment from Reuters.
Ordonez and the five other current and former Bank of Spain officials, along with two former senior managers at Spain’s CNMV stock market regulator, have been testifying before the investigating judge, Fernando Andreu, this week.
Under the Spanish legal system people can be named as formal suspects until a more detailed investigation is carried out to bring charges.
Three of the eight - all top officials from its supervisory and inspection units - resigned in February because they did not want to affect the central bank’s functions while testifying as part of the case.
The Bank of Spain said in February its staff had acted correctly in their oversight of Bankia.
($1 = 0.9468 euros)
Reporting By Jesús Aguado; Editing by Angus Berwick and Elaine Hardcastle