Spain's fourth-biggest bank Bankia said Saturday it was certain of securing the 19 billion euros ($24 billion) in state aid it is seeking in the largest bank bailout in the country's history.
Bankia president Jose Ignacio Goirigolzarri sought to reassure investors and the public about the future of the struggling bank at a press conference called the day after it announced huge losses and asked for a government rescue.
The plight of Bankia -- which holds some 10 percent of the nation's bank deposits -- has added to the concerns over the massive debt crisis gripping Spain and the rest of the eurozone.
"I am certain that the Spanish state will obtain the financing so we will receive the 19 billion euros. That's the commitment," said Goirigolzarri, adding that he expected to get the funds in July.
The funding will be part of a recapitalisation plan which the bank's board approved on Friday and is backed by the government and the Bank of Spain.
At the press conference in Madrid, Goirigolzarri stressed that after the recapitalisation, Bankia would be "solid, efficient and profitable".
The Spanish government has already spent 4.5 billion euros on Bankia after the lender was partially nationalised earlier this month.
The new bailout will bring to 23.5 billion euros the total amount of the government's rescue funding for the bank, which was formed in 2010 from a merger of seven troubled regional savings banks.
Bankia had to revise its 2011 results to show a net loss of 2.979 billion euros due to write-downs in its loan portfolio, instead of a net profit of 309 million euros.
Spanish banks are at the heart of market fears that Spain itself, the eurozone's fourth-largest economy, could be forced to seek an international financial bailout.
Under the recapitalisation plan it approved Friday, Bankia's parent group Banco Financiero de Ahorros (BFA) will ask Spain's bank restructuring fund FROB to subscribe to a capital increase of 19 billion euros.
Bankia will then launch a 12 billion euro capital hike which will be underwritten by BFA.
Goirigolzarri on Saturday defended the bank's former management team.
"We must be absolutely careful in our judgements," he said, noting that his predecessor Rodrigo Rato had to deal with a "very complex" situation.
Rato, a former economy minister and head of the International Monetary Fund, and his team had been forced to resign.
"I am not here to launch a purge," Goirigolzarri said when asked about a possible probe into events at the bank, whose shares have plunged to half their value since listing in July 2011i.
Goirigolzarri blamed the massive loss on the economic crisis, which saw the collapse in 2008 of Spain's real estate market -- a pillar of the country's economy -- after a decade-long boom.
Bankia had the sector's largest exposure to the property market of 37.5 billion euros at the end of 2011, of which 31.8 billion euros were classed as problematic, according to figures from the Bank of Spain.
Standard & Poor's on Friday downgraded Bankia to BB+, one notch into junk status, from BBB- and also cut its rating for the parent group BFA, which was already in the junk status of BB-, to B+, four notches into junk territory.
Standard & Poor's also cut its rating for Bankinter, Banco Popular and Banca Civica.
Daniel Pingarron, an analyst at Spanish brokerage IG Markets, said Friday the injection of public funds into Bankia to save it "will not change things very much".
"What will happen is the FROB funds will run out, the fund will have to be replenished with public debt, and that does not sent a message of confidence," he added.
Bankia is considered key to the country's financial system and therefore cannot be allowed to fail as it would contaminate the entire sector.
The Expansion newspaper said eight banking institutions in Spain had received public funds totalling 32.869 billion euros and another 6.2 billion from private investors.
Prime Minister Mariano Rajoy's conservative government this month instructed Spain's banks to set aside an extra 30 billion euros in 2012 in case property-related loans go bad, on top of 53.8 billion euros required under reforms enacted in February.