Spain’s second-largest bank BBVA and smaller rival Banco Sabadell said on Friday they had scrapped plans for a possible tie-up that could create the country’s largest lender.
Sabadell said in a statement that it had “decided to terminate these discussions” as the two parties had failed to come up with a share exchange agreement.
Banks across Europe are struggling to cope with record-low interest rates and the economic downturn sparked by the coronavirus pandemic, which has raised pressure on them to boost liquidity by selling assets or through tie-ups.
Banks across Europe are struggling to cope with record-low interest rates and the economic downturn sparked by the coronavirus pandemic
BBVA posted a net loss of €15 million for the first nine months of 2020 while Banco Sabadell, Spain’s fifth-largest bank, saw net profit fall during the period by 74 per cent to €203 million as it increased provisions for bad loans.
Founded in 1857, BBVA employs more than 100,000 people in about 30 countries.
It has a strong presence outside of Spain in former Spanish colonies in Latin America as well as in Turkey.