“This means a 3.5% increase in earnings per share.”
This Friday, BBVA held an extraordinary general meeting of shareholders to approve the capital increase necessary to implement the takeover bid for Banco Sabadell. During his speech, the president of the organization, Carlos Torres, reiterated that the offer they presented to the Catalan bank was “attractive” and indicated that this merger “That means a 3.5% increase in earnings per share from the start.”as soon as the savings associated with integration occur.
Carlos Torres wanted to attract his shareholders through dividends. In his speech, he promised to maintain his “attractive remuneration policy,” which includes the distribution of between 40% and 50% of the profits due each year, as well as an obligation to distribute any excess capital exceeding 12%, subject to obtaining the necessary authorizations and regulatory approvals. And this clause is addressed not only to BBVA shareholders, but also those in Sabadell, who will have to decide at the end of the year whether to approve the sale of the bank.
“The creation of Banco Sabadell represents a great opportunity. It is the fourth bank in Spain, with assets in the UK and Mexico.“Moreover, it is a high-quality franchise with very positive financial performance dynamics in recent years,” Torres emphasized in his speech to shareholders.
The bank’s president recalled that integration with the Catalan bank will allow BBVA to gain scale and become the second bank in terms of share of loans at the national level.
Torres said the joint bank aims to become “the best partner” for the SME and self-employed segment. For this reason, the President of BBVA recalled the bank’s commitment to maintain, barring “clear deterioration”, working capital lines for companies and SMEs for at least one year.
“The creation of Banco Sabadell represents a great opportunity. It is the fourth bank in Spain, with assets in the UK and Mexico. It is also a high-quality franchise with very positive financial performance in recent years,” he stressed.
The banker recalled that BBVA’s goal is to remain a significant player in the markets in which it operates. For this reason, over the past 10 years, the company has sold assets worth 16 billion euros. In cases like Paraguay, since the market did not offer “necessary attraction” while in other countries, such as the United States or Chile, it was due to lack of scale.
The BBVA president also recalled the figures behind the operation. The merger of both companies will enable cost synergies of €850 million to be achievedof which 100 million is due to lower cost of financing.
These cost savings, which will occur over three years, will entail restructuring costs of €1.45 billion. All of this will result in a capital increase of 30 basis points if the takeover bid is accepted by 100% of Banco Sabadell shareholders.
The banker assessed BBVA “experience” in previous integrations, which supports the bank’s calculations and allows it to “be confident in the success of the integration.”
In addition, Torres recalled that, according to BBVA’s forecast, the joint bank will have an additional lending capacity of 5 billion euros per year.
“The creation of Banco Sabadell represents a great opportunity. It is the fourth bank in Spain, with assets in the UK and Mexico. Moreover, it is a high-quality franchise with very positive dynamics in financial indicators in recent years,” emphasized the President of BBVA.
An extraordinary meeting of shareholders was held with the participation of preliminary quorum 70.74%while shareholders holding just over 4,000 million shares are present or represented.