Shares in nationalised Spanish lender Bankia slumped on Monday after a rescue fund valued the stock at less than one penny each, before a planned injection of fresh capital.
The valuation wiped out investors in the country's fourth-biggest bank and was widely expected as the government tries to draw a line under Spain's biggest-ever bank failure and give Bankia a fresh start.
But the pain for investors, many of them small Spanish investors who bought into the lender's July 2011 initial public offering at 3.75 euros (£3.18) a share, is unlikely to end there.
Bankia is expected to dip far below the new bailout price in coming months as investors focus on the bank's weak state, a struggling Spanish economy and a new government plan to partially merge Bankia with two other troubled lenders.
Under Bankia's recapitalisation, hybrid debt and preference shares are due to be converted into discounted ordinary shares.
Analysts believe thousands of the bond and preference share owners will sell their new ordinary stock at the earliest opportunity to try to recoup some of their heavy losses, pulling the shares down further.
Bankia stock was at 0.155 euro (1.33p) by 2.45pm GMT on Monday, compared to its Friday close of 0.25 euro (2.1p).
Selling pressure was so great that trading in Bankia shares began more than an hour after the market opened.
Analysts expect Bankia shares to progressively adjust to the 1 euro cent valuation before the cash injection due in May, but say it could later fall as low as 0.004 euro.
The bank, formed in 2011 from the merger of seven savings banks, is showing tentative signs of recovery as it prepares to receive an injection of 10.7 billion euros (£8.7bn) in European bailout funds in May.
Spain's government requested 41 billion euros from its European partners to rescue Bankia and other lenders that had amassed bad debt from the country's 2008 property market crash.
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