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Bankia increases amount allocated to dividends by 7%, to 340 million euros, and pays back more state aid

26 January 2018

Category: Corporate

Related information

  • The Board of Directors agrees to propose to the General Meeting a dividend of 11.024 euro cents per share to be paid out of profits for 2017
  • Based on its current holding, the Spanish State, through the FROB, would receive 207 million euros, bringing the total amount of repaid aid by Bankia to 2,863 million euros
  • Despite the difficult environment in recent years, the bank has been able to generate sufficient capital to complete the merger with BMN without this affecting the dividend per share
  • Bankia appoints Carlos Egea as an executive director of the bank

The Board of Directors of Bankia has agreed to propose to the General Meeting of Shareholders of the bank, the distribution of 340 million euros in dividends, which is 7% more than the previous year.

If this proposal is approved, the dividend would be set at 11.024 cents per share, equivalent to 2.756 cents per share before the reverse split carried out in June 2017.

The bank would thus maintain its dividend per share compared to last year, although the total amount paid is greater due to the increase in the number of shares after the capital increase that was carried out as a result of the merger with BMN.

As in the last three years, the dividend will be paid in cash and as a one-time payment, which is expected to be paid in April.

This will be the fourth dividend in Bankia's history. Since July 2015 when Bankia paid its first dividend, the cumulative amount paid, will reach 1,160 million euros.

Despite the difficult environment which the financial sector has had to contend with during this period, the bank has succeeded in generating enough capital to undertake the merger with BMN without it affecting the dividend per share.

Repayment of state aid increases to 2,863 million euros

After the merger between Bankia and BMN, the stake held by the Fund for Orderly Bank Restructuring (FROB) in the resulting entity, whether directly or indirectly through BFA Tenedora de Acciones, stood at 60.933%. If this holding remains unchanged at the payment date of the dividend, Bankia would return a further 207 million euros to taxpayers.

The dividend distribution thus allows the bank to continue to repay the state aid received.

With the privatisation of 7.5% of Bankia's capital in February 2014, which contributed 1,304 million euros, the sale of another 7% last December, which brought an additional 818 million euros of revenue for the FROB, and the four dividends paid to date, the State will already have recovered a total of 2,863 million euros.

Part of the dividend will also remunerate the former shareholders of BMN, now Bankia shareholders. Thus, the foundations of the four savings banks, that merged to form BMN will jointly receive nearly 3.5 million euros.

Carlos Egea, new executive director of Bankia

In addition, the Bankia Board of Directors has approved the appointment of Carlos Egea, until now a non-executive director of Bankia, as a new executive director of the bank.

The Bankia Board will thus be made up of eleven members: José Ignacio Goirigolzarri, José Sevilla, Antonio Ortega, Carlos Egea, Joaquín Ayuso, Francisco Javier Campo, Eva Castillo, Jorge Cosmen, José Luis Feito, Fernando Fernández and Antonio Greño.

Of the total number of directors, four are executive, while the remaining seven are considered "independent".

Born in 1947, Egea started his career in the industrial sector, later joining the financial services sector through Banco Atlántico. In 1976 he moved to Caja de Ahorros de Murcia (CAM). In 1983 he was appointed CEO of CAM and in 2008, chairman. From 2010 until the merger with Bankia, Egea was Chairman of the Board of Directors of BMN.

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