Spain has a lot of questions at the moment, but very few answers. Ten-year lending rates for the struggling country are once again rising past 6%, which makes borrowing money difficult for a country already in recession and trying to cope with an imploding housing market and a 24.4% unemployment rate.

I've already sounded off that I think a default is practically a given based on Spain's worsening financial situation, but I can't say that I saw its latest move coming so soon.

Wednesday, following the close of the U.S. markets, the Bank of Spain, its equivalent to our Federal Reserve, announced that it will convert its 4.5 billion euro interest in BFA and Bankia that it obtained through bailout loans in 2010 and 2011 to shares and essentially nationalize Spain's fourth-largest bank by assets. The reason behind the move is that Bankia has the greatest exposure to Spanish commercial real estate loans -- 32 billion euros, to be exact.

What's really goofy/stupid/mind-numbing (choose your best word) about this whole situation is that its original loan amount of 4.5 billion euro was lent to facilitate the merger of seven smaller savings banks into Bankia while also creating a 45% parent company to Bankia, known as BFA, which is nothing more than a bad bank that holds the toxic real estate assets of the seven smaller savings banks. Why the Spanish government didn't just nationalize BFA in the first place is beyond me, because this is just more bad publicity at a time when it can afford none.

And so it goes: The first Spanish bank is officially on its way to being nationalized. That's not particularly sound news for shareholders of Banco Santander (NYSE: STD) and Banco Bilbao Vizcaya Argentaria (NYSE: BBVA), which have a much larger presence in Spain's financial picture, albeit much less toxic real estate exposure. That didn't stop Societe Generale from projecting in February that Banco Santander and BBVA could take a hit of 42% and 52%, respectively, to their bottom-line profits as they set aside cash to shore up reserves against toxic real estate loans.

According to the Bank of Spain, of the 348 billion euros in commercial real estate loans, up to 176 billion euros of that amount could be problematic. With just over 50% of CRE loans either in foreclosure or in serious doubt of collection, the Bank of Spain's plans to inject 10 billion euros into Bankia doesn't exactly inspire confidence that its problems will be solved. It's likely to take a considerably larger injection than this to make a dent in Bankia's toxic portfolio of loans.

Is this the last bank to be nationalized in Spain? Only time will tell as Spain marches closer to what I think is an inevitable default.

Is nationalizing Bankia going to change your opinion on Banco Santander or BBVA? Tell your fellow Fools in the comments section below.

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Fool contributor Sean Williams has no material interest in any companies mentioned in this article. You can follow him on CAPS under the screen name TMFUltraLong, track every pick he makes under the screen name TrackUltraLong, and check him out on Twitter, where he goes by the handle @TMFUltraLong. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy that has no interest in nationalizing your portfolio.