Misc 16/11/2020

BBVA and Banco Sabadell negotiate merger

The banks inform watchdog

Xavier Grau Del Cerro
2 min
Imatge del Centre corporatiu del Banc de Sabadell a Barcelona / ACN

BarcelonaBBVA confirmed on Monday that it is in talks with Banco Sabadell for a possible merger. In a communication to the regulator, National Securities Market Commission (CNMV), the bank has confirmed the rumor that had spread during the day in the markets after it was known that it was selling its subsidiary in the United States for 9.7 billion.

"BBVA confirms that it is holding talks with representatives of Banco Sabadell SA, with the authorisation of the board of directors, regarding a potential merger of the two entities," the statement said. Subsequently, Banco Sabadell has also informed the CNMV.

Both banks have confirmed that the process of reciprocal review of the situation of the two entities, known as due diligence, has been initiated under the usual terms of this type of operation, and external advisors have been appointed.

However, both banks indicate that "no decision has been taken regarding this potential merger operation and there is no certainty that it will be adopted, nor, in this case, regarding the terms and conditions of a possible operation".

According to market sources, BBVA has contracted the business bank JP Morgan for these negotiations with Sabadell, while Sabadell would have done the same with Goldman Sachs. The legal side would be handled by Uria y Menéndez on behalf of Sabadell and Garrigues on behalf of BBVA, according to various media sources.

Rise in Catalonia

If this operation takes place, BBVA will strengthen its share in Spain, but above all in Catalonia, where the bank presided over by Carlos Torres has grown since the financial crisis, first with the absorption of Unnim - the bank resulting from the merger of the savings banks of Sabadell, Terrassa and Manlleu - and later of CatalunyaCaixa, the bank resulting from the integration of the savings banks of Catalonia, Tarragona and Manresa.