BANKIA SA (PINK:BNKXF) surged as much as 700 percent today after opening at €1.38 per share, taking into account the €10.7 billion bailout. The bank’s stock price was virtually wiped out by the bailout just a little over a month ago. According to Spanish newspaper El Pais, BANKIA SA (PINK:BNKXF) became the largest Euro zone bank by market capitalization when counting the new shares that will be issued. At the end of the trading day, BANKIA SA (PINK:BNKXF) shares closed out 190 percent up and will open Wednesday a €4.
The bank’s 1012 loss was a record €19 billion, but it posted first-quarter profits last week after cleaning soured property mortgages off its balance sheet. As a result, other businesses like the Spanish state-owned banking group BFA, has pledged €275 million to buy new shares issued by BANKIA SA (PINK:BNKXF).
Bankia has come to be a symbol of the banking crisis in Spain, and the new shares were issued as part of its recapitalization plan. The new shares will begin trading May 28 at a price of €1.35 per share, according to Reuters. The bank now has four years to complete its restructuring efforts and go back to being under private control.
In all, the four nationalized banks in Spain have lost a total of €42 billion, according to Thomson Reuters. CatalunyaBank added €12 billion to Bankia’s big loss, while NCG Banco reported €8 billion in losses. Banco Mare Nostrum reported losses of €2.5 billion back in February.
Currently the Spanish government is said to be considering running all four banks under one holding company.