Solid banking franchise in Spain, with more than an 11% market share. Enhanced risk management, which will benefit future credit performance. Balanced funding structure. Modest core operating profitability amid the current low interest rate environment. Need to extract revenues and enforce efficiency from the recently acquired Banco Mare Nostrum (BMN). Relatively high stock of problematic assets, despite a substantial transfer to Spain's bad bank SAREB in 2012. The stable outlook on Bankia reflects our view that despite a potentially more supportive economic environment leading to better capital measures at Bankia, capital strengthening is unlikely to be material enough to drive an upgrade over the next 12-24 months. Our expectation is that the bank's risk-adjusted capital (RAC) ratio will improve to
