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UPDATE 1-Bankia sells City National Bank of Florida for $883 mln
May 24, 2013 / 6:51 PM / in 4 years

UPDATE 1-Bankia sells City National Bank of Florida for $883 mln

MADRID, May 24 (Reuters) - Spanish nationalized lender Bankia SA said on Friday it had sold City National Bank of Florida to Chilean bank BCI for $883 million, part of a plan to sell assets to boost solvency.

Bankia, bailed out by Europe last year in Spain’s biggest bank rescue, said the sale would book 180 million euros (US$233 million) of net capital gains and generate 30 basis points of core capital, a measure of resilience to economic downturn.

Bankia must sell assets and close branches under the terms of its 24.5 billion euro bailout, which was brokered by Spain after it became clear the bank could not cope with losses from a 2008 property and construction crash.

Bankia paid $927 million for 83 percent of the Florida bank in 2008 and bought the remaining stake later on for an undisclosed amount.

The deal also means a reduction in 435 staff for the bank, Bankia said.

Bankia said it had had 13 expressions of interest in the sale, which were whittled down to six non-binding offers. The deal awaits approval from the United States, Spain and Chile and will likely close before March 2014, the bank said.

Bankia’s core capital ratio, a measure of solvency, was 10.1 percent at the end of March 2013.

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