CASCAIS, Portugal, Sept 10 (Reuters) - Spain's third largest bank, Popular, thinks there will soon be opportunities to grow its domestic market share, the bank's head of investor relations said on Thursday.
"We have a market share of 5 percent in Spain and we see upcoming circumstances to improve (this)," Francisco Sancha told Reuters on the sidelines of II BPI's Small and Mid Cap conference.
Popular said on Wednesday it would launch new share and convertible bond issues worth about a combined 1 billion euros ($1.46 billion), using part of the funding to continue its organic growth and take advantage of any short- and mid-term opportunities.
The 500 million euro share issue was fully placed on Thursday at 7 euros per share.
After the share and bond issues, Popular said its core capital ratio would reach 8.49 to 8.71 percent and its Tier 1 rate would be between 9.80 and 10.03 percent.
While Spain's banks have been largely shielded from the global financial crisis by strict provisioning rules, the steep downturn in the property sector after a decade-long boom has fuelled a sharp rise in bad loans as realtors and developers go to the wall.
"We would applaud some asset writedowns in (Popular's) real estate developer's book as a result of this capital raising, but we doubt the bank (will) use this fresh capital to clean its balance sheet," ESR analysts said.
Popular shares closed down 4.86 percent at 7.04 euros, compared to a 1.06 percent drop on the IBEX-35 (.IBEX).
Asked whether core shareholders Portuguese businessman Americo Amorim and Indian businessman Ram Bhavnani will retain their stakes in Popular, Sancha said: "We have a strong shareholder base, and we are satisfied. We expect that they will keep running with us."
(Reporting by Shrikesh Laxmidas and Vitor Moreira; writing by Judy MacInnes; editing by John Stonestreet)