Bankinter And Its 20% “Super Dividend”: 1 Share of Línea Directa For Every Bank Share You Own


T.C.| Línea Directa Aseguradora (LDA) will finally be listed on the Spanish stock exchange on April 29th at a price of 1,317 euros per share, valuing the company at 1.434 billion. Bankinter, the lender which owns the insurer, will hold 17.4% of the company. It will give its shareholders one LDA share for each Bankinter share held on April 28th, the last day for taking part in the operation.

Before proceeding to the distribution of LDA amongst its shareholders, Bankinter paid itself a dividend of 120 million euros and today Bankinter (BKT) is trading at 5.7 euros per share. Five months ago it was trading at less than 3.5 euros.

Bankinter announced LDA’s IPO in 2019, in light of the enormous capital consumption that maintaining 100% of an insurance subsidiary implies for the bank, in line with the parameters of the new Basel banking regulation.
In this way, Bankinter – possibly the healthiest of the Spanish banks, with very little real estate credit on its balance sheet – circumvents the general prohibition on dividend payments formulated by the ECB (which has of course given its approval to the operation). In addition it is offering securities initially valued at more than one euro to the current holders of its shares, which are worth less than 6 euros, implying a yield of close to 20%.

Today Bankinter has a market capitalisation of 5.161 billion euros and offers a dividend yield of 5%, with a P/E ratio of 29x. LDA is the fifth largest Spanish insurer, with almost 900 million euros in turnover and 3.2 million customers. It also has one of the highest Solvency II ratios in the sector, at 213%.

The Board of Directors of the new listed company, LDA, will be formed by Miguel Ángel Merino, CEO of Línea Directa; two proprietary directors, Alfonso Botín-Sanz de Sautuola, Chairman, and Fernando Masaveu; and four independent directors, John de Zulueta, Elena Otero-Novas, Rita Estévez and Ana María Plaza (interviewed last March in the magazine Consejeros:

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The Corner has a team of on-the-ground reporters in capital cities ranging from New York to Beijing. Their stories are edited by the teams at the Spanish magazine Consejeros (for members of companies’ boards of directors) and at the stock market news site Consenso Del Mercado (market consensus). They have worked in economics and communication for over 25 years.