Bloomberg News

Spain May Need to Inject $6.4 Billion in Bankia, Expansion Says

May 12, 2012

Spain may need to pump 5 billion euros ($6.4 billion) into Bankia Group to boost the lender’s capital, Expansion reported, citing unidentified people close to the government.

The cash injection will be implemented through the purchase of capital contingent notes to be issued by the nationalized lender, Expansion said. Previously the government was expecting to inject 2.5 billion euros of new capital, Expansion said.

The measure will be on top of the conversion of 4.5 billion euros of subordinated debt sold two years ago by the bank to the government-run bank bailout fund, or Frob, into new stock, Expansion said.

A Madrid-based spokeswoman at the Economy Ministry declined to comment. No press officer at Bankia was available to comment when contacted by Bloomberg after business hours.

To contact the reporter on this story: Esteban Duarte in Madrid at eduarterubia@bloomberg.net

To contact the editor responsible for this story: Emma Ross-Thomas at erossthomas@bloomberg.net


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