Spanish banks Bankia and Banco Mare Nostrum (BMN) have been given the go ahead to discuss plans of a proposed merger, Reuters reports.
Both banks will consider the proposal by Spain’s FROB bailout fund in a bid to recover public money used to rescue the banks back in 2012.
Following the 2008 financial crisis only 14 of the 55 banks in Spain are still in existence. Bankia and BMN were bailed out to the sum of €24 billion after the crisis hit the property sector causing the banks to lose a huge amount of money on property loans.
Bankia, Spain’s fourth largest bank is 66% state owned whereas smaller lender BMN is 65% state owned. The banks have a combined asset value of €230 billion and both plan to undergo privatization before December 2019.
“The reorganization of these entities, through the merger of Bankia and BMN, is the best strategy to fulfill our mandate of optimizing the recovery of public funds before a future disinvestment process,” said FROB.
Tags: Banco Mare Nostrum, Bankia Spain, Financial Services Spain