The vice president of the European Central Bank (ECB), Luis de Guindos, expressed this Friday in Madrid the institution’s support for banking mergers in Europe, with the precision that it prefers them cross-border.
“We are in favor of consolidation in Europe, but always favorably or with a very favorable vision of cross-border consolidations, between banks of different nationalities of origin,” he stated during the banking conferences organized by Iese between yesterday and today. His statements come days after BBVA’s hostile takeover of Sabadell.
For the approval of the takeover bid for the Catalan bank, the approval of the ECB is necessary. At last week’s press conference to present the offer, BBVA president Carlos Torres said that he had already contacted regulators and supervisors, and expressed confidence in the central bank’s approval.
The ECB’s vision on mergers has not changed despite the “context”, De Guindos stated. However, he has said that “it was very good” that French President Emmanuel Macron was receptive to banking operations between countries.
In an interview with Bloomberg, Macron was asked how he would act if a bank from another European country like Santander wanted to buy a French bank like Société Générale. “Negotiating as Europeans means that we have to consolidate ourselves as Europeans” and “we must be open and offer a single market approach that is much more efficient,” he said.
De Guindos has lamented the lack of a single banking market at the European level and the relatively low valuations of the continent’s entities in relation to those in the United States. “It does not help investors’ understanding of what European banks are,” she said.
He has also described as “adequate” the decision of the Bank of Spain to activate the countercyclical buffer so that banks save resources in good times. It will imply a demand of about 7,500 million from the banks after two years from 2025.
In the case of BBVA, which has said that it has no room to improve its takeover bid for Sabadell, its assets in Spain are 121,779 million euros, so the 1% countercyclical cushion that the Bank of Spain requires it to do represents an effort of 1,217 million, as deduced from its 2023 annual report.
The measure may have an impact on the distribution of dividends, at a time when both BBVA and Sabadell are competing to attract the shareholders of the Catalan bank after the takeover bid announced last week.