Spain said it would take over Bankia SA and prepared to inject public funds into the banking group with the most Spanish real estate as part of government efforts to bolster confidence in the country’s lenders.
Spain’s bank bailout fund will convert its $5.8 billion of preferred shares in Bankia’s parent company Banco Financiero y de Ahorros, or BFA, into voting shares, the Economy Ministry said in a statement Wednesday. The action will give it a controlling stake of 45 percent in Bankia, the ministry said, adding the government will provide the capital that’s “strictly necessary” to clean up the lender.
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