Feb. 28 - Spanish lender Bankia posts the country's biggest ever corporate loss of 19.2 billion euros for 2012, but the troubled lender insists it's on track for a recover in 2013. Ciara Sutton reports.
19.2 billion euros is today's daily digit in Europe. It's Spain's biggest ever corporate loss and it comes from troubled lender Bankia. The figures for 2012 are the result of write downs on rotten property after the bank became the focal point of Spain's banking crisis. Simon Maughan is global financials strategist at Olivetree Securities. (SOUNDBITE) (English) SIMON MAUGHAN, GLOBAL FINANCIALS STRATEGIST AT OLIVETREE SECURITIES, SAYING: "Those problem loans that developed there are the core of Bankia's issue. On to that you add on a number of smaller banks with large real estate problems and really that's why a lot of people think the stocks true value is zero." Last year Bankia took a massive state bailout, which then prompted the country to seek 40 billion euros from Europe to clean up its troubled financial sector. The Bankia-BFA group as a whole posted losses of 21.2 billion euros. But the bank is optimistic it will return to profit in 2013, and achieve a return on equity of over 10 percent by 2015. It says deposits improved in the fourth quarter and its bad loan ratio dropped to 13 percent. (SOUNDBITE) (English) SIMON MAUGHAN, GLOBAL FINANCIALS STRATEGIST AT OLIVETREE SECURITIES, SAYING: "They are a collection of the worst lender in Spain and therefore they are a concentration of the problems and not a representation of the wider Spanish banking system." There's less optimism about the Spanish economy. It shrank for the sixth straight quarter from October to December, hampering government efforts to slash the public deficit. The outlook for this year isn't much brighter, a second year of recession is looming.