Spain's Banking Bailout Fund FROB Surpasses 50% Stake in Bad Bank Sareb

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Spain's state rescue fund FROB has increased its stake in the country's "bad bank" Sareb to more than 50%, in line with a European Union order to count its liabilities as public debt, Reuters reported. FROB said on Tuesday that it had bought a 4.24% stake in Sareb, set up in 2012 to take on bad loans after the financial crisis, to raise its holding to 50.14%. No price was given but several sources with knowledge of the matter said it was merely symbolic. The move comes after the government in January approved a legal framework allowing FROB to surpass the 50% threshold in Sareb following the EU order. FROB didn't say which banks had sold their stakes but a source at Sareb said some smaller holders, such as Bankinter, had tendered their stakes. Bankinter declined comment. Santander remains the biggest private shareholder with a 22.2% stake, followed by Caixabank with 12.2%. Several Spanish banks have been planning to sell their stakes in Sareb, which has struggled since its creation as a slump in real estate prices has depressed the value of loans and assets, but most had retained their holdings for tax reasons. Read more.