Spain's Bankia Could Sell Prized Florida Bank

Ongoing troubles in Europe could force another bank there to sell off a key U.S. holding.

The $4.3 billion-asset City National Bank of Florida said Wednesday that its parent company, Bankia, is among a number of institutions that reached an agreement with the European Union and Spain's government to recapitalize after accepting bailout funds. The restructuring would require the Spanish banking company to sell noncore assets and holdings outside of Spain, including City National, within four years.

"Because City National Bank is so well capitalized, profitable and well-positioned in the marketplace, we are going to take our time to fully evaluate all of our strategic alternatives," Jorge Gonzalez, City National's president and chief executive, said in a press release. "This does not impact our ongoing strategy of profitable growth and diversification or our commitment to the markets we serve."

Bankia bought City National four years ago for $1.1 billion. City National has 26 branches in Florida and was the state's sixth-biggest bank based on deposit market share at June 30, according to the Federal Deposit Insurance Corp.

The bank is profitable and well-capitalized, with a total risk-based capital ratio of 18.4% at Sept. 30. Those characteristics could make the bank an attractive target for a regional bank since there are few Florida-based banks with scale.