Spanish Prime Minister Pedro Sanchez has adopted a cautious stance on the proposed takeover of Banco Sabadell by BBVA, despite his government’s prior strong opposition to the deal, Bloomberg reports.
Speaking at the World Economic Forum in Davos on Wednesday, Sanchez refrained from expressing a definitive opinion, stating he would defer to the country’s competition authorities.
“What I want to see is a strong financial system in Spain, let’s wait and see what our competition authorities say in this regard,” Sanchez told the agency, repeatedly emphasizing the need to await the outcome of the antitrust review.
The proposed acquisition is currently being scrutinized by Spain’s National Markets and Competition Commission (CNMC). The CNMC’s decision in November to escalate the assessment to a second, more intensive phase was widely viewed as unfavorable for BBVA, as it increases the likelihood of the agency imposing stringent conditions on the deal.
BBVA’s unsolicited bid for Sabadell, made in May, is being closely observed across Europe as a litmus test for regulators’ attitudes toward domestic bank consolidation and the potential impact of mergers on financial institutions’ performance. The deal has drawn considerable opposition within Spain, particularly from the central government and regional authorities in Catalonia, where Sabadell is headquartered.
Banco Sabadell, responding to the hostile bid, announced Wednesday that its board will convene to discuss a proposal to relocate its registered office to its namesake town of Sabadell. This move is seen as an attempt to garner political support from its traditional base in the fight against the takeover.
Previously, the Spanish government expressed concerns that a BBVA takeover would reduce competition within the banking sector, potentially harming retail customers and small and medium-sized enterprises (SMEs). Sabadell has a significant market share in the SME sector, making it an attractive target for BBVA.
While the Spanish government lacks the power to block BBVA from acquiring a stake in Sabadell, it can prevent a full merger. This could result in BBVA owning a portion of its rival without gaining full control.
Spain’s resistance to banking consolidation reflects a broader trend in Europe. The German government has voiced opposition to a possible takeover of Commerzbank by UniCredit, while a separate attempt by UniCredit to acquire Banco BPM has faced criticism from some Italian officials.
This contrasts with the stance of French President Emmanuel Macron, who expressed support in May for the potential takeover of a major French bank by an EU rival.
