Banco Sabadell Emphasizes the Public Interest Amid BBVA's Acquisition Bid
CEO César González-Bueno highlights the critical role of local banks in financing small and medium-sized enterprises.
César González-Bueno, CEO of Banco Sabadell, asserted the importance of 'public interest' in response to BBVA's bid for the bank.
Speaking at a banking sector meeting organized by IESE in Madrid, he emphasized that beyond issues of 'solvency' and 'competition,' the existence of multiple banks is essential for financing small and medium-sized enterprises (SMEs) in Spain.
González-Bueno pointed out that SMEs with annual revenues between €50 million and €100 million heavily rely on local banks for their financing needs, as they are not viable candidates for bond issuance or access to foreign banks.
He stated, 'For them, financing is a matter of life or death.'
While acknowledging that national banking mergers can enhance the sector's efficiency, he cautioned against potential impacts on broader public interests that should be monitored.
The European Central Bank evaluates solvency post-merger, and the National Commission on Markets and Competition (CNMC) has addressed competition concerns, but González-Bueno urged for vigilance on other significant issues.
In contrast, BBVA's Spanish chief, Peio Belausteguigoitia, emphasized the potential benefits of the merger proposal for the general interest, customers, employees, shareholders, and society as a whole.
González-Bueno also addressed the common arguments regarding the need for larger European banks to compete with U.S. giants.
He stated that with Banco Sabadell representing only 1.5% to 2% of JPMorgan’s market capitalization, it is unrealistic to expect to compete directly with American banks.
He advocated for larger cross-border mergers among European banks with significant international presence, noting the challenges in achieving efficiencies from such mergers, as they often do not lead to cost reductions or synergies.
The conversation around BBVA's acquisition bid has been prominent at the event, with other executives, such as Bankinter's CEO Gloria Ortiz, referencing it as an 'elephant in the room.' Ortiz expressed her company's commitment to organic growth and described potential mergers as traumatic for employees and customers.
She highlighted the importance of maintaining efficiency, profitability, and value for clients amidst the changing landscape in the banking sector.
Speaking at a banking sector meeting organized by IESE in Madrid, he emphasized that beyond issues of 'solvency' and 'competition,' the existence of multiple banks is essential for financing small and medium-sized enterprises (SMEs) in Spain.
González-Bueno pointed out that SMEs with annual revenues between €50 million and €100 million heavily rely on local banks for their financing needs, as they are not viable candidates for bond issuance or access to foreign banks.
He stated, 'For them, financing is a matter of life or death.'
While acknowledging that national banking mergers can enhance the sector's efficiency, he cautioned against potential impacts on broader public interests that should be monitored.
The European Central Bank evaluates solvency post-merger, and the National Commission on Markets and Competition (CNMC) has addressed competition concerns, but González-Bueno urged for vigilance on other significant issues.
In contrast, BBVA's Spanish chief, Peio Belausteguigoitia, emphasized the potential benefits of the merger proposal for the general interest, customers, employees, shareholders, and society as a whole.
González-Bueno also addressed the common arguments regarding the need for larger European banks to compete with U.S. giants.
He stated that with Banco Sabadell representing only 1.5% to 2% of JPMorgan’s market capitalization, it is unrealistic to expect to compete directly with American banks.
He advocated for larger cross-border mergers among European banks with significant international presence, noting the challenges in achieving efficiencies from such mergers, as they often do not lead to cost reductions or synergies.
The conversation around BBVA's acquisition bid has been prominent at the event, with other executives, such as Bankinter's CEO Gloria Ortiz, referencing it as an 'elephant in the room.' Ortiz expressed her company's commitment to organic growth and described potential mergers as traumatic for employees and customers.
She highlighted the importance of maintaining efficiency, profitability, and value for clients amidst the changing landscape in the banking sector.
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