Spain's Bankia plunges on market

Shares in Spain's bailed-out lender Bankia plunged on the stock market Thursday after banking authorities said it had a negative of value of 4.148 billion euros ($5.5 billion). Shares in Bankia, which is at the heart of a crisis in the bad-loan ridden Spanish banking system, slumped 13.27 percent to 59.5 cents in morning trade. Spain's state-backed Fund for Orderly Bank Restructuring, or FROB, said the previous day that Bankia had a negative value of 4.148 billion euros and its parent group BFA a negative value of 10.444 billion euros. Bankia-BFA is to receive about 18 billion euros in public aid. BFA's capital is to be expanded by 13.459 billion euros in addition to 4.5 billion euros extended to the lender in September, the FROB said. Doubts hung over the true worth of shares in Bankia, whose 20-billion-euro bailout by the government in May prompted Spain to seek funding of up to 100 billion euros from its eurozone partners for the banking sector. Spanish banks are still struggling with a mass of loans that turned sour after a property bubble collapsed in 2008. A first slice of 37 billion euros in eurozone aid is aimed at cleaning up four rescued banks: Bankia, NovaCaixaGalicia (NCG), Catalunya Banc and Banco de Valencia. The four banks are to receive the capital within days, the FROB said, enabling them to meet requirements that they have a top quality "core capital" equal to nine percent of total assets.