Baker & McKenzie advised Bankia and Banco Financiero y de Ahorros (BFA), the state-owned holding company which controls Bankia, on its first sale of non-performing real estate loans to a foreign investor.

The portfolio of 419 loans was sold to hedge fund Chenavari and is one of the major loan divestments of 2014. The sale allows Bankia to reduce its non-performing loan book and improve its liquidity position.

The deal is known as Project Sky. Partner Rafael Bazán led the team, assisted by Sara Pérez and Fátima Prieto.

Mr. Bazan commented: "The disposal of non-performing loans is key to returning the Spanish banking industry to health. Interest in the sector has picked up enormously in 2014, facilitating the sale of these portfolios."

PwC acted as financial advisor.