Spain's Santander raises 7.2 billion euros in new capital: company

Santander, Spain's largest bank which has undertaken a string of acquisitions this year, announced on Friday that a 7.2-billion-euro (9.2-billion-dollar) rights issue has been fully subscribed.

The bank announced on November 10 it had offered almost 1.6 billion new shares at 4.5 euros each in a bid to raise capital.

"The increase in capital announced on November 10 ... has been fully subscribed during the preferential period," the bank said in a statement.

"I am delighted with the great success of this transaction," said Santander chairman Emilion Botin.

The situation contrasted sharply with crippled British lender Royal Bank of Scotland, which offered new shares worth 15 billion pounds (18 billion euros, 23 billion dollars) to private investors on Friday but was forced to turn to the government.

RBS said on Friday that ordinary shareholders had agreed to take up only 0.24 percent of the shares. The British government took up the balance, giving the state a 58-percent stake.

Botin said Santander's ability to strengthen its core capital "is especially important in the current economic climate."

The news of the rights issue had sent Santander shares plunging on the Madrid stock market.

At 3:43pm (1443 GMT) Friday, Santander shares were up 0.63 percent at 6.38 euros in a stable market.

Santander is Europe's second-biggest bank by market capitalisation after HSBC of Britain and the biggest in the eurozone.

Last month, it announced that its third-quarter net profit rose 4.3 percent to 2.2 billion euros, and said it was on track for record full-year profit despite an abrupt economic slowdown at home and global financial turbulence.

Its solid financial position has allowed it to buy three troubled banks over the past three months.

Santander purchased Alliance and Leicester in Britain, as well as some assets of the nationalised Bradford and Bingley, and has agreed to take over Sovereign Bancorp in the United States.

It announced last month it has decided not to sell its asset management unit due to poor current market conditions.

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