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Banco Bilbao Vizcaya Argentaria SAAnnouncement

06/09/2014 18:41

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RNS Number : 9271M
Banco Bilbao Vizcaya Argentaria SA
21 July 2014 
 
BBVA wins auction for Catalunya Banc 
 
The BBVA Group has taken a major step in its commitment to its domestic market
by acquiring Catalunya Banc through an auction held by the Orderly Bank
Restructuring Fund (known as FROB). The move doubles BBVA's market share in
Catalonia and makes it the most relevant player in the sector in Spain. The
acquisition will have a positive impact on the Group's results in 2016. 
 
"This deal shows we are extremely confident in the current economic recovery,"
BBVA chairman and CEO Francisco González said. "This acquisition is good for
BBVA and for Catalunya Banc, and helps strengthen the Spanish financial
system." 
 
BBVA will pay the FROB E1.187 billion for Catalunya Banc and the deal is
expected to be closed in the first quarter of next year. Catalunya Banc has
1.5 million customers and E63 billion in assets. The auction was held after an
extensive cleanup process of Catalunya Banc by the FROB. 
 
BBVA will acquire Catalunya Banc without having to resort to a capital
increase. BBVA's capital ratio, which stood at 10.8% in March, will drop by
around 55 basis points as a result of this deal. 
 
Catalunya Banc has a net equity of E2.5 billion and the estimated net present
value of the synergies exceeds E1.2 billion. This acquisition will have a
positive impact on the Group's results as of 2016. 
 
With this purchase, BBVA's loan portfolio in Spain will grow 14%, deposits 23%
and its customer base 18%. Catalunya Banc holds E25 billion in retail
deposits, E28 billion in gross loans and 773 branch offices. 
 
The price will be reduced in an amount equal to E267 million provided that,
prior to the 
 
effective closing of the transaction, FROB and Catalunya Banc do not obtain a
confirmation 
 
issued by the Spanish tax authorities of the application of the deferred tax
assets regime 
 
(foreseen in Royal Decree Law 14/2013) to some losses recorded in Catalunya
Banc's 
 
consolidated financial statements for 2013 which were originated as a
consequence of the 
 
transfer of assets by Catalunya Banc to the Management Company for Assets
Arising from the Banking Sector Reorganization (known as "SAREB"). 
 
Catalunya Banc's operations are concentrated in Catalonia, one of the most
dynamic and attractive markets in Spain. Catalonia accounts for 19% of Spain's
GDP, 16% of the population and 25% of the exports. 
 
Catalunya Banc is BBVA's second acquisition in Spain arising from the
restructuring process of the financial system managed by the FROB. The first
purchase was Unnim Banc, which was announced in March 2012. Unnim's successful
integration was completed in May 2013. 
 
The acquisition of Catalunya Banc comes at a moment when Spain has started an
economic growth phase. BBVA Research estimates the Spanish economy should
expand by more than 1% in 2014 and by around 2% in 2015. 
 
Contact details: 
 
Comunicación Corporativa 
 
Tel. +34 91 537 53 48 
 
comunicacion.corporativa@bbva.com 
 
For more financial information about BBVA visit: 
 
http://shareholdersandinvestors.bbva.com 
 
For more BBVA news visit: http://press.bbva.com/ 
 
About BBVA 
 
BBVA is a customer-centric global financial services group founded in 1857.
The Group has a solid position in Spain, it is the largest financial
institution in Mexico and it has leading franchises in South America and the
Sunbelt Region of the United States. Its diversified business is focused on
high-growth markets and it relies on technology as a key sustainable
competitive advantage. Corporate responsibility is at the core of its business
model. BBVA fosters financial education and inclusion, and supports scientific
research and culture. It operates with the highest integrity, a long-term
vision and applies the best practices. The Group is present in the main
sustainability indexes. 
 
This information is provided by RNS
The company news service from the London Stock Exchange