MADRID â€" The Spanish government announced on Friday that it sold a 7.5 percent stake in Bankia, its first step toward returning the bank to private ownership and recovering part of the bailout money that Bankia received after triggering Spain’s banking crisis two years ago.
The stake was sold to institutional investors at €1.51 per share, a 4.4 percent discount to Thursday’s closing price. The sale, which raised 1.3 billion euros or about $1.8 billion, still leaves almost 61 percent of Bankia’s equity under state ownership. But it was seen as an important test of whether the bank had regained the confidence of institutional investors.
Shares in Bankia have risen more than 25 percent this year as the lender has turned from an emblem of Spain’s reckless lending into a symbol of what might be the beginning of the country’s financial revival.
Bankia returned to profit last year after receiving about half of the €41 billion of bank bailout money that euro zone finance ministers agreed to give Spain during a frenzied weekend conference call in June 2012. Since then, the bank has sold assets to bolster its balance sheet, as well as cut its branch network by a third and its staff by a fifth.
Bankia said in a statement on Friday that “this transaction is evidence of investors’ interest in the capital of Bankia.â€
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On Thursday, ahead of the results of the transaction, Luis de Guindos, Spain’s economy minister, told a conference here that the demand for Bankia’s equity showed there had been “a change in the perception of our financial system†among investors.
In January, Bankia also managed to return to the bond market for the first time since 2012 and raised €1 billion, double its initial target.
The state was forced to seize control and replace the management of Bankia in May of 2012 because of its unsustainable mortgage loan portfolio, crippled by the bursting of Spain’s construction bubble four years earlier. The bank was forced to restate its accounts and posted a loss of €19.2 billion for 2012, the largest in Spanish banking history.
Under the terms of the European bailout of Spain’s banking system, the government has until 2017 to sell its holding in Bankia. The Frob, the state bank restructuring agency that controls Spain’s nationalized banks, is expected to sell more of its Bankia equity later this year, but retain majority control for the time being.
Bankia shares were suspended early Friday, ahead of the announcement, but then fell almost 4 percent to €1.52 when trading resumed, almost in line with the price at which the 7.5 percent stake was sold.
Earlier this month, Bankia reported a net profit of €512 million for 2013, following the record net loss of €19.2 billion in 2012.
