Spain suspends trading in Bankia shares ahead of $19bn bailout
Bankia, Spain’s fourth largest bank, is reportedly set to ask the government for a bailout of more than USD 19 billion which can help the troubled lender to stay afloat.
Bankia’s shares plummeted more than 7 percent on Thursday, taking total losses to more than 58 percent since July 2011.
The bank’s new management team is, therefore, planning a board meeting on Friday to decide on a possible refunding plan.
Meanwhile, Spain’s Economy Minister Luis De Guindos announced on Wednesday that the country will inject an amount of USD 11.33 billion to recapitalize the nationalized lender.
Bankia has so far received 4.5 billion euros in state loans from the government during its nationalization process.
The bank was formed in a merger of seven saving banks in 2011 and was partly nationalized roughly two weeks ago, as a result of its bad property debt problems.
The recent developments have also affected its parent company, Banco Financiero y de Ahorros, causing its shares to be suspended as well.