Bankia suffers 'negative value' score

28 December 2012

The bank rescue fund in Spain has given Bankia a 'negative value' fund, which has resulted in shares in the group falling by almost 20 per cent.

According to the assessments, the financier currently has a value of -€4.2 billion (-$5.6 billion), while its parent company BFA was judged to be worth -€10.4 billion.

Entitled FROB, the Spanish bailout fund, which is owned by the country's government, predicted BFA would require additional rescue money to the tune of €13.5 billion.

This would add to the €4.5 billion injected into the organisation by Madrid earlier in the year, with BFA ordered to provide €10.7 billion of the cash as new capital to Bankia.

A source from the central bank with knowledge on the matter told Reuters: "Are we looking into leaving shareholders with something? Yes. How much? That's too soon to say. Will it be very little? For sure."

By Asim Shah

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