Spain Takes Over Bankia, Readies Second Bailout for Lender
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Spain said it would take over Bankia SA and may inject public funds into the banking group with the most Spanish real estate as the government prepares the fourth attempt to overhaul the financial system.
Spain’s bank bailout fund will convert its 4.5 billion euros ($5.8 billion) of preferred shares in Bankia’s parent, Banco Financiero y de Ahorros, into voting shares, the Economy Ministry said in a statement yesterday. That will give it a controlling stake of 45 percent in Bankia, the ministry said, adding the government will provide the capital that’s “strictly necessary” to clean up the lender.