MADRID (Reuters) -The head of Spain’s antitrust watchdog said on Tuesday the country’s banking sector would still be competitive after BBVA’s proposed acquisition of Sabadell thanks to the presence of other lenders such as Caixabank.
The Spanish government opposes BBVA’s hostile takeover bid, currently worth around 14 billion euros ($15.55 billion) and rejected by Sabadell on concerns it could lead to job losses.
Cani Fernandez, head of the regulator CNMC and in her first comments since the CNMC approved the deal with remedies last month, dismissed competition concerns. She said “there is sufficient activity in the area of small and mid-sized lending, with other operators already in place to accept commitments.”
Citing as an example, she said Sabadell was losing market share in the lending to small businesses in Catalonia, where it makes most of its business, to “existing banks, including Caixabank, none of which are BBVA, meaning that it is not the closest competitor.”
BBVA wants to create the second-biggest bank in Spain by loans after Caixabank.
Madrid has launched a non-binding public consultation on the matter, an unprecedented move for such deals.
The five largest banks in Spain control 70% of the market share after a wave of mergers left the sector with 10 lenders, down from 55 before the financial crisis in 2008.
After submitting a seventh set of remedies, BBVA got the CNMC’s clearance as it vowed to maintain working capital lines for three years, extendable by two more years, for all small companies working with Sabadell.
($1 = 0.9003 euros)
(Reporting by Jesús Aguado; editing by Inti Landauro and Susan Fenton)
