Bankia posts record €21 billion loss
Spain's Bankia chairman Jose Ignacio Goirigolzarri (right) arrives to testify at court in Madrid earlier this month. Photograph: Juan Medina/Reuters
Spanish bank Bankia, whose collapse last May helped push Spain into a European banking bailout, today posted after-tax losses of €21.2 billion, the largest in Spanish corporate history, as it cleansed soured assets from its balance sheet.
The loss widened from €4.95 billion euros in 2011, Madrid-based Bankia said in a filing to regulators today.
The bank earmarked €26.8 billion in provisioning charges in 2012 after its listed Bankia unit posted a net loss of €19 billion compared to a loss of €2.98 billion in 2011, it said.
Spain sought as much as €100 billion in European bailout funds last year on concerns that mounting losses at Bankia, crafted from a merger of seven savings banks, would pile pressure on government finances.
After the group took €18 billion of state aid, chairman Jose Ignacio Goirigolzarri is targeting earnings of €1.2 billion in 2015 as he shifts soured real estate to Spain's new bad bank, sheds about 6,000 staff and closes 39 per cent of its branches.
The after-tax loss would have been €19.4 billion taking into account gains from an exchange of hybrid debt instruments, the group said.