Novacaixagalicia, the merging of several Galician savings banks, in it´s way to transform into a commercial bank named NCG Bank, is clearing the way for its future. It has recapitalized and met new solvency requirements, thereby minimizing steps to its eventual appeal to Frob, a government fund designed to help the financial industry
Turning lead into gold is an art, and the seasoned Galician executive José María Castellano is a likely alchemist who can bring new Spanish and foreign investors to the bank.
The Inditex Group (owner of retailer store Zara) is looking for a 60% discount, which is greater than the 50% the banks want. Not an insurmountable obstacle for an operation that´s distancing itself from recovery funds and meets Xunta´s requirements. The next challenge is to make the company´s plan viable and credible.
Yet according to sources familiar with the negotiation, Caixanova y Caixa Galicia are trying to improve the discount to 50%, keeping a majority of shares of the subsidiary bank and not having to convert them into funds. If the investors achieve their goals, they will have done so with 34% capital, but gaining control.
This is one of the indisputable stipulations for pulling off the deal. Ceding to the banks demands, they would make off with about 27% of the shares.
