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The CNMV maintains a veto over the bears in Liberbank by the capital increase

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The CNMV maintains a veto over the bears in Liberbank by the capital increase

The entity rises in Stock a 5,77% after ban until November 30 of bets against ir actions

The securities and exchange commission decided Tuesday to extend veto to positions bearish on Liberbank's to next 30 November. The agency justified decision for capital increase of 500 million euros that institution announced last week to accelerate consolidation of toxic assets and real estate from its balance sheet. The extension of regulatory stock market made securities of entity y shot a 5,77%, thus putting an end to several days of punishment, in Bag unleashed following announcement of expansion.


  • Liberbank collapses in Bag after announcing expansion of capital
  • Liberbank will expand capital by 500 million and sell real estate assets
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  • The securities and exchange commission prohibits to speculate to downside, with shares of Liberbank for a month

Liberbank lived a day convulsed on Stock exchange, pending decision of CNMV, which must occur before midnight. In that time expired, prohibition of short positions, which had been decreed on 12th of June and extended for two months on July 12. In first hour, share price climbed just over 2%, but at 11.28, a teletype from agency EFE, after deleted, reported that re would be an extension to veto bearish. That information, even though it was deleted, did action would trigger more than 5%. At 12.26, CNMV decided to suspend quotation. A couple of hours later, he announced that ban on movement bears would continue in force “maximum” until 30 November, and returned bench to parquet floor. The first reaction was of elation and action is shot up by almost 9%, though it later slowed to close with a rise of 5,77%.

The securities and exchange commission justified enlargement in capital increase announced by company last week. In fact, regulator said in a note that “although extension is extended until 30th of November, intention is to raise prohibition [of speculation bearish] as soon as enlargement process is complete.”

Clean up balance

Liberbank, product of integration of Cajastur, Caja de Extremadura, Caja Castilla-La Mancha and Caja Cantabria, announced last week a capital increase of eur 500 million as well as plans to sell 800 million euros in real estate assets. The bank itself admitted that expansion was going to "raise coverage of non-performing assets”, that is to say, to clean up a balance sheet weighed down by a significant exposure to real estate sector. The entity already had in place plans of sanitation, so that expansion and sale of assets were a way to speed up process. The response of investors to extension was a drop of 12.3% in Stock on Thursday. Friday, fell a furr 5.4% and on Monday by nearly 3%.

This delicate situation of balance already weighed on entity at beginning of June. After fall of Popular, bank was wrapped in a spiral bearish that resulted in loss of more than 40% of its quotation on Stock exchange in just over a week. The rumors about bad situation encouraged bears, despite fact that bank demanded for its smooth running and considered to be unjust punishment on stock market. Finally, CNMV came to defense of Liberbank and on 12th of June decreed prohibition of speculating to floor with ir titles, decision postponed again on Tuesday.


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