Spain takes 45% stake in Bankia

[Book]

Spain takes 45% stake in Bankia

(Financial Times) -- Spain has taken a 45 per cent stake in Bankia, the country's third-largest bank by assets, as worries over the financial system sent equity and bond markets falling on Wednesday.

The Bank of Spain said Bankia and BFA, its parent company, had informed it that the conversion of €4.47bn of state aid in the bank into ordinary shares was "the most advisable option for strengthening the financial soundness". As a result of the conversion the Frob, Spain's bank bailout fund, will hold the 45 per cent stake in Bankia.

Spain's ministry of economy said the move was "a necessary first step to ensure its solvency, the tranquility of depositors and dispel doubts about the entity's capital needs".


http://edition.cnn.com/2012/05/09/business/spain-bankia/index.html


::) [B]...by definition it is already "insolvent" and that is why the government had to buy it

[osoab]

<li class="sticky">


http://www.zerohedge.com/sites/default/files/pictures/picture-5.jpg (http://www.zerohedge.com/users/tyler-durden)
Bank Of Spain Formally Nationalizes Bankia, Says Insolvent Bank Is "Solvent", Adds There Is No Cause For Concern (http://www.zerohedge.com/news/bank-spain-formally-nationalizes-bankia-adds-there-no-cause-concern)

Submitted by Tyler Durden (http://www.zerohedge.com/users/tyler-durden) on 05/09/2012 - 15:43 Google (http://www.zerohedge.com/category/tags/google) Nationalization (http://www.zerohedge.com/taxonomy/term/8625) The only thing funnier than a nationalization statement spun as positive, or favorable for taxpayers, is one that has been Google translated, in this case from Spanish, courtesy of Bank of Spain, which has just formally bailed out Bankia, leaving the best for last: "In any case, BFA-Bankia is a solvent entity that continues to function quite normally and customers and depositors should have no concern." Move along. Nothing to see here. Nobody should be concerned.

[Neuro]

What a relief that it wasn't anything serious! ::)

[gunDriller]

kind of a Spanish version of what the US has been doing the last 4 years.