(Updates with bank seeking ECB loans in fourth paragraph, shares in fifth.)
July 28 (Bloomberg) -- Bankia SA, the nationalized lender that Spain’s government is selling back to investors in a sign of the country’s recovery, said profit more than doubled as revenue rose and bad loans and costs fell.
Net income increased to 432 million euros ($580 million) in the first half from 200 million euros a year earlier, the Valencia, Spain-based lender said in a filing to regulators today. Earnings beat the 393 million-euro mean estimate in a Bloomberg survey of nine analysts.
Losses linked to real estate at BFA-Bankia, a banking group forged from a merger of savings banks led by Caja Madrid, pushed Spain into taking a 41 billion-euro European bailout to prop up lenders in 2012. The government sold a 7.5 percent stake in Bankia to investors in February in a first step to recoup state funds used to rescue the lender.
The bank will probably seek 3 billion euros in new long- term loans from the European Central Bank, Chief Financial Officer Leopoldo Alvear said at a news conference today. The lending program was among stimulus measures announced by the ECB in June to loosen credit and prevent deflation.
Bankia shares rose 1.3 percent to 1.5 euros at 10:38 a.m. in Madrid.
Net interest income, or the difference between what a bank charges for loans and pays for funding, rose to 1.43 billion euros from 1.09 billion euros a year ago, Bankia said.
Administrative costs fell to 795 million euros from 888 million euros after the bank shrank its workforce and closed branches to comply with the terms of European aid. Bad loans as a share of total loans dropped to 14.03 percent from 14.65 percent in December.