Spanish bank Bankia on Friday agreed to sell Miami-based City National Bank of Florida to Chile's BCI for $882.8 million, part of a broader plan to shed assets.
Although the price of the transaction is less than the $1.11 billion that Caja Madrid - part of the future Bankia - paid for a 100 percent stake in the Florida bank, the Spanish institution netted a capital gain because it had steadily lowered the subsidiary's book value since 2010.
In a statement, Bankia Chairman Jose Ignacio Goirigolzarri hailed the transaction and noted that the bank had received 13 expressions of interest and six offers.
U.S., Spanish and Chilean regulators still must give the green light for the deal.
Caja Madrid, one of seven troubled regional savings banks that merged in 2011 to create Bankia, acquired CNB in 2008.
Bankia was forced to sell the Florida bank and shed other non-core assets under the terms of its 22-billion-euro bailout last year by the European Union.
CNB, which has 26 branches, posted net profit of $68.5 million in 2007 but began registering losses after being acquired by Caja Madrid.
BCI, Chile's third-largest bank with assets valued at $38 billion, has operations in Mexico and representative offices in Spain, Peru, Brazil and Colombia.
Caja Madrid's acquisition of CNB is being investigated by a Spanish judge to determine if it was carried out in a manner designed to elude the prescriptive oversight of the Madrid autonomous community's Economy and Finance department.
The regional savings bank also paid more for CNB than Spain's Banco Popular and Banco Sabadell did for other Miami-based financial institutions, Spain's central bank said in a report.
Caja Madrid's former chairman, Miguel Blesa, was jailed on May 16 amid a probe into the alleged irregularities, although he was released on bail of 2.5 million euros (roughly $3.2 million) a day later. EFE