The Spanish bank Santander saw the value of its shares tumble by 10% in the wake of its surprise fundraising drive from shareholders.
The Spanish bank Santander saw the value of its shares tumble by 10% in the wake of its surprise fundraising drive from shareholders.
Its new chair Ana Botín asked shareholders for €7.5bn, about 10% of its share capital, while at the same time announcing dividend cuts, in a dash to shore up the bank.
Santander, the biggest bank in the eurozone, passed the European bank stress test last year but there was speculation that it was weaker than many other banks.
It had planned to sell1.258bn shares at €6.18-€6.50 each, but shares dropped to €6.17. They were suspended on the Madrid stock exchange.
Some observers say that the move could be an attempt to strength the balance sheet, perhaps in expectation of a big acquisition.
Despite the pressure of the financial meltdown, Santander had until now to keep dividends unchanged, but now intends to cut its 2015 payout to 20 cents a share, from 60 cents.
