The Catalan Banc Sabadell to acquire the Banco Gallego

Madrid (ACN).- The Spanish Fund for Orderly Bank Restructuring (FROB) announced on Wednesday that the offer presented by Banc Sabadell has won the tender for the acquisition of Banco Gallego, which has been nationalised. Banco Gallego was partially owned by Novagalicia Banco, the private bank resulting from the savings bank Nova Caixa Galicia. The FROB announced its decision after analysing the offers presented. It also explained that the final details of the contract are still “being negotiated and decided”, which is on the “condition that the foreseen legal requirements are honoured and that it is authorised by the nation and international authorities in charge”. The details of the operation were not disclosed. In the last year and a half, Banc Sabadell has bought the former Caja de Ahorros del Mediterráneo, the business activity of Caixa Penedès (part of Banco Mare Nostrum) and now Banco Gallego.

At the end of 2011, the President of Banc Sabadell, Josep Oliu, announced the purchase of the Banco CAM, the private bank resulting from the intervention in Caja de Ahorros del Mediterráneo (CAM). The operation meant €164 billion in assets and 1,800 branches throughout Spain. In the process, 600 branches were merged, thus reduced to 300 offices, and 236 branches changed their brand to Sabadell’s. In the Valencian Country (also called Valencian Community) and the Region of Murcia, the branches are called SabadellCAM. The operation also meant the firing of 1,250 people, most of the cases through early retirement, volunteer leave and temporary contract suspensions.

A few days later, the Catalan bank announced that it was buying the Banco Mare Nostrum, Caixa Penedès’ banking business in Catalonia and Aragon. The agreement allowed Banc Sabadell to increase its commercial network by 92% in Catalonia. With the operation, Banc Sabadell added 462 branches, 900,000 clients and 2,000 more workers. It also meant the firing of 500 employees through volunteer leave, early retirement and replacement.

In 2012, Banc Sabadell obtained a net profit of €81.9 million, 64.7% less than in 2011. The reason for the low benefits is that the bank allocated €2,540.6 million to provisions on its stock exchange and real estate portfolios, 142.2% more than in 2011.