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The chair of Banco Sabadell, Josep Oliu, has sent a letter to retail shareholders reassuring them of Sabadell’s “bright” independent future as it faces a hostile takeover attempt from BBVA.
BBVA’s initial all-share bid, valuing Sabadell at €12bn, was rejected by Sabadell’s board, leading BBVA to directly approach Sabadell’s shareholders.
The Spanish government also opposes the merger on the grounds that it will negatively impact competition, financial inclusion and regional financial systems in Sabadell’s core Spanish markets, Catalonia and Valencia.
Oliu’s letter, obtained and reported on by the Financial Times, states that BBVA’s offer “significantly undervalued” Sabadell’s “growth prospects as an independent institution”.
A source familiar with the matter told the FT that Sabadell faces significant risks if the merger proceeds without government approval, noting that BBVA could end up controlling two separate banks without the ability to integrate them, limiting potential cost savings.
BBVA needs approval from several regulators, including the European Central Bank, before it can proceed with its tender offer to Sabadell shareholders, expected later this year.
Read more: Potential BBVA-Sabadell merger would create one of western Europe’s 10 largest banks
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The European Central Bank is streamlining its annual health checks on eurozone banks to focus on critical issues and improve supervision efficiency.
Claudia Buch, the ECB’s supervisory chief, stated that the revamp would make its “Supervisory Review and Evaluation Process” less cumbersome while increasing the use of penalties and enforcement actions against non-compliant banks.
“The SREP will become shorter and move closer to real-time supervision,” Buch said in a blog post on Tuesday. “This is more relevant than ever considering the fast-evolving risk environment.”
The ECB’s changes to streamline and strengthen bank supervision will begin in the second half of this year and will be fully implemented by the 2026 SREP cycle.
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A Russian court has ruled that a €239mn claim by a venture of Kremlin-owned Gazprom against Deutsche Bank should be partially satisfied.
As reported by Reuters, the dispute stems from the termination of a gas plant construction contract in Russia due to western sanctions, involving St Petersburg-based RusChemAlliance, a joint venture 50 per cent owned by Gazprom.
Deutsche Bank stated in comments to Reuters that the decision is not final or enforceable yet, and they will “analyse it and decide on further steps”, once the complete court decision is received. The bank has provisioned around €260mn for the case.
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Germany’s financial regulator BaFin is lifting its growth restriction on neobank N26, allowing it to onboard an unlimited number of new customers starting in June.
The restriction, imposed in September 2021 due to concerns about money laundering and financial crime, limited N26 to 60,000 new customers per month. This cap has hindered the Berlin-based bank’s growth and has led to over €100mn in compliance costs over the past two years.
N26 was founded in 2013 and has 8mn customers in 24 European countries, but in the past few years it has pulled back from some of its international expansion plans, exiting the UK, the US and Brazil.
