Debt For Equity Swap Of The Week: Santander

From FT Alphaville:

Since Unicredit is doing this rights issue to meet the European Banking Authority’s target for banks to meet a nine per cent core capital ratio by June – it’s also worth mentioning in passing Santander’s announcement on Monday that it’s met the EBA goal. Modestly hooting that it’s "one of the world’s most solid and well-capitalised banks", Santander says it’s found €15bn of additional capital via the following:

- EUR 6,829 million through Valores Santander.

- EUR 1,943 million through the exchange of preferred shares for ordinary new shares.

- EUR 1,660 million through the application of the Santander Dividendo Elección program (scrip dividend) at the time of the final dividend corresponding to fiscal year 2011.

- EUR 4,890 million through organic capital generation and the transfer of certain stakes, mainly in Chile and Brazil.

Interesting to note that the "Valores Santander" portion is made up of converting retail bonds that were originally issued in 2007 into shares during October 2012. As the WSJ has reported, it’s been anything but “valores” for Santander retail investors who bought these securities.

Yes, it's tough, but better them than the taxpayer, eh?