Spanish government to sell 7.5% in state-backed Bankia

Spain's government has taken the first steps towards privatising the nationalised lender Bankia by issuing shares amount to a 7.5% stake in the business.

Spain’s government has taken the first steps towards privatising the nationalised lender Bankia by issuing shares amounting to a 7.5% stake in the business.

Bankia, 68% owned by the taxpayer, had to be bailed out to the tune of 18bn ($24.8bn) during the financial crisis. It was the biggest of Spain’s banks to require a bailout.

Speaking about the sale, economy minister Luis de Guindos said: "This is truly a sign of the shift in perception and of the reality of our financial system."

Bankia returned to profit last year after suffering its greatest ever loss of 19.2bn in 2012.

The government is due to sell up to 18% of its stake in the lender this year, but will not sell any more, as it wishes to retain control over the bank.

Deutsche Bank, Morgan Stanley and UBS are to handle the sale of the shares.

The sale of the stake was announced on 28 February and shares in Spain’s fourth-largest bank closed at 1.58 that day, valuing the stake at 1.4bn.

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