“Chaos” is the word many would use to describe what has been happening in recent months inthe Italian banking sector, with the so-called risk which is becoming more and more intricate day by day. Between accusations and counter-accusations, appeals to the courts, requests and forceful interventions by the authorities, following the details of the various operations is increasingly complicated. But those who speak of an "unprecedented scenario" are very wrong. In fact, it is enough to take a quick look beyond the border to realize that, after all, "the whole world is the same". Bank consolidation it is indeed a central theme in many European countries, with the main credit institutions engaged in extraordinary maneuvers and operations aimed at strengthening their capital and supporting revenues in a period of falling rates. And if the "quick glance" is replaced by a more careful observation, one quickly realizes that there is a characteristic that unites the European banking risk: the increasingly pressing interventionism of governments.
In Italy there is the golden power of the Meloni government that risks sinking the ops launched by Unicredit on Banco Bpm. In Germany there is the Merz government that has raised a "Berlin Wall" against the takeover of Unicredit (always them) on Commerzbank. In Portugal there is the government of Lisbon that does not look favourably at all on the interest of foreign banks such as CaixaBank (Spanish) and Bpce-Natixis (French) towards New Bank, fourth largest bank in the Portuguese country. But the most emblematic case of all comes from Spain, where for almost a year the executive led by socialist Prime Minister Pedro Sánchez has been doing everything in its power to block the maxthe offer launched by Bbva on Banco Sabadell.
Bbva-Banco Sabadell: what happened
Over a year ago, on April 30, 2024 to be exact, Bbva launched a friendly purchase proposal for Banco Sabadell which a few days later, following the refusal of the Catalan institution's board of directors, turned into ahostile offer worth over 14 billion. From the beginning the Spanish government said it was against to the merger "both in form and substance", speaking of strong risks for employment, despite the fact that over the months the operation has received the green light from all the competent authorities, from the ECB to the Antitrust.
Last June 24, not without some pressure from Brussels which has repeatedly reiterated that it sees no reason to block the operation, the Iberian Council of Ministers has indeed given the green light, but by imposing very difficult conditions. One in particular: Bbva and Sabadell will have to remain for three years, extendable for another two, two distinct legal entities, with separate activities and independent management.
The intervention of the Madrid executive forced the Basque institution to analyze for days whether it made sense to maintain the offer. In particular, the question concerned the possibility of continuing to exploit the 850 million synergies calculated at May 2024.
Finally, on June 30, the verdict arrived: “Despite the conditions imposed by the Council of Ministers, the project creates immense value for the shareholders of both institutions,” BBVA Chairman Carlos Torres said in a short video message. Translated: thethe offer goes ahead regardless.
The surprise sale of TSB to Santander
Just 24 hours later, on July XNUMXst, yet another twist came to overturn an already very complicated operation: Sabadell has announced the sale of its British subsidiary TSB to the banking giant Santander for 3,1 billion euros. Not only that, the institute has declared that the proceeds of the sale will be used to finance a extraordinary dividend in cash of 0,50 euros per share, equal to 2,5 billion euros ($2,94 billion), in addition to 1,3 billion in ordinary dividends expected to be paid out of 2025 earnings.
Although the bank's top management has denied the idea that the sale represents “a shield” to slow down the BBVA takeover bid, The move “further complicates BBVA’s proposed acquisition of its Spanish rival and could prompt a change in the current terms of the deal,” RBC Capital Markets said in a note, analysts said. The sale “appears to be the last major effort to persuade shareholders not to tender their shares to BBVA’s offer during the acceptance period,” analysts added.
For Bofa, however, "although positive for Sabadell, the impact on the price/earnings multiple will be limited, given that the United Kingdom represents approximately 15% of the group's profits". Not only that, Bofa recalls that Bbva's offer "remains valid and presents a solid industrial logic and financial, despite the restrictions imposed by the Spanish government”, Furthermore “the exit from the United Kingdom is in line with BBVA’s strategy, and could still provide room to improve the terms of the offer to Sabadell”.
