Nationalization of Bankia in Spain is rejected by the market.

247 – In a transaction involving approximately €4,5 billion in public funds, the Spanish government announced the nationalization of Bankia, the country's third-largest financial institution, with 10 million customers and 21 employees, acquiring control of 45% of its shares. Without the state investment, made in the form of a loan in exchange for the shares, Bankia would not have been able to cope with a high level of non-performing loans totaling €37,5 billion, mostly for mortgage financing.

The bailout, however, failed to convince the market, which pushed the Madrid stock exchange index into the red and raised interest rates on government bonds to 6%, signaling a lack of confidence in the government plan. Bankia is the result of a merger between seven Spanish financial institutions, completed in 2010. It appears that the plan to concentrate brands like the traditional Caja de Madrid under the Bankia umbrella did not have the expected effect and even damaged the reputation of economist Rodrigo Rato as a manager. A former IMF director and former Minister of Economy, he resigned as president of Bankia last week, giving way to José Ignacio Goirigolzarri, appointed by the government. Prime Minister Mariano Rajoy declared that, following the Bankia bailout, a new aid package for Spanish banks using public funds will be announced in the coming hours. They will have to increase their provisions for non-performing loans. Recently, the Standard & Poor's rating agency downgraded the ratings of 11 Spanish financial institutions.