Spain's rescued Bankia sells Iberdrola stake

Spain's Bankia, rescued by the state from near financial collapse in 2012, announced Thursday it had raised 1.53 billion euros ($2.1 billion) by selling its stake in energy giant Iberdrola. It was the biggest single asset sale by Bankia and its parent BFA since the group was salvaged two years ago with a 20-billion-euro rescue, financed by Spain's European partners. With losses of more than 19 billion euros and a large number of weak property-related assets accumulated during a real estate bubble that imploded in 2008, Bankia lay at the heart of Spain's 2012 banking crisis. Since then, it has shut down more than 1,000 branches and shed thousands of staff. The lender reported a net profit of 509 million euros for 2013. Bankia said in a statement that the sale of its 4.94-percent stake in Iberdrola delivered a profit of 266 million euros. The 314.9 million Iberdrola shares were sold at 4.85 euros each, some 0.15 euros below the previous day's closing price on the Madrid stock exchange, said two investment banks handling the deal, Citigroup and UBS. During morning trade, Bankia shares fell by 3.1 percent to 4.487 euros while Iberdrola eased 0.07 percent to 1.48 euros. Bankia has already sold stakes worth 2.4 billion euros in several groups, including 12 percent of Spanish insurer Mapfre for 979.4 million euros and 12.09 percent of International Airlines Group, which owns British Airways and Iberia, for 675 million euros. Spain launched the privatisation of Bankia in February with the sale of a 7.5-percent stake for 1.3 billion euros. Most of the buyers were foreign investors. The sale of the stake lowered the Spanish state's holding in Bankia to about 61 percent. Forced to shore up Bankia and other troubled lenders threatening the entire Spanish banking system, Spain's government tapped its European partners in 2012 for 41 billion euros in rescue loans. Under the terms of the European Union's 2012 bailout, the Spanish government has until 2017 to sell its stake in Bankia.