Body denies that the Government’s actions have caused BBVA’s takeover bid to fail with its veto of the merger

The Minister of Economy, Carlos Body, assured this Friday that he does not believe that the conditions imposed by the Government to BBVA’s takeover bid for Banco Sabadell have led to the failure of the operation and he states that his department will explain to the European Commission (EC) that the procedure followed is “fully compatible” with European legislation.

“We are in contact with the EC to give them all the necessary arguments to continue conveying not only that the government’s actions are part of our regulations, but that our regulations are fully compatible with European legislation“, Corpo explained in a press conference held in Washington at the end of the annual meetings of the International Monetary Fund (IMF) and the World Bank, in which he participated.

The Community Executive announced this Friday that it will maintain the infringement procedure open to Spain despite the failure of BBVA’s takeover bid for Banco Sabadell, since the file refers to the Spanish legislation used in the operation, which, according to Brussels, could breach community regulations. In Corp’s opinion, “this takeover bid has a positive result because of the precedent it has set regarding to the capacity of this type of operations to generate value for shareholders, for the private sector in this case, and to be able to do so while protecting general interests.

The head of Economy said that, after knowing the result of the takeover bid, “we must respect the will of the shareholders and the market.” Body pointed out that the operation has been “particularly complex” and longer in time “than usual.” The minister highlighted the good performance of all the regulators involved, from the Bank of Spain, the National Markets and Competition Commission (CNMC) and the National Securities Market Commission (CNMV).

“The message It is of maximum respect for the decision of the shareholderswho were the ones who had to make the decision,” reiterated Body, who highlighted the competitiveness of the Spanish banking sector, “one of the most solvent” at the European level, and its good performance on the stock market.

The infringement procedure was communicated on July 17 and contemplated a period of two months to respond and correct. The Government requested a six-week extension of the deadline from the European Commission, which was granted. It was opened by breach European legislation by granting in national regulations “unlimited powers” to the Government to intervene in bank mergers that conflict with European laws, following its decision to prohibit BBVA’s takeover bid for Banco Sabadell for at least three years.