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Spain's BBVA sells 4.9 pct stake in China's CITIC to boost capital

(Adds detail, background) MADRID, Jan 23 (Reuters) - Spanish bank BBVA has agreed to sell a 4.9 percent stake in China's CITIC Bank to property developer Xinhu Zhongbao for HK$13.136 billion ($1.69 billion) as it looks to bolster its capital base. BBVA said on Friday it would book net capital gains of around 400 million euros ($450 million) and strengthen it core capital ratio by 20 basis points after the sale, which is expected to be finalised in the first quarter. BBVA had a core capital ratio of 10.1 percent under the so-called Basel III fully-loaded criteria at the end of September and has committed to keep this ratio at around 10 percent. While the lender had excess capital of over 13 billion euros under an European Central Bank health check last year, tougher global rules on capital ratios and their ownership of financial institutions have forced BBVA and others to set aside more cash or sell holdings in foreign lenders. BBVA, which had already cut its CITIC stake in 2013 by selling a 5.1 percent chunk to state-owned parent CITIC Ltd, said it would retain a 4.7 percent stake in the Chinese bank. It also sold at a loss in December its near 30 percent stake in CIFH, a unit of CITIC. In the meantime, Santander, BBVA's main competitor in Spain, earlier this month raised 7.5 billion euros through a share sale that lift its core capital ratio by about 1.4 percentage points to about 10 percent this year. BBVA's profit in Eurasia, which combines its operations in China and Turkey, was up 13 percent in the January-September period from a year ago. BBVA shares were up 1.24 percent to 8.08 euros per share, broadly in line with Spain's blue-chip index Ibex, up 1.27 percent. ($1 = 7.7513 Hong Kong dollars) ($1 = 0.8881 euros) (Reporting by Julien Toyer; Editing by Mark Potter)