tsb

The Catalan banking group Banc Sabadell earned €708.4 million in 2015, according to figures published by the company. This result is 90.6% higher than that obtained in 2014. The good result of Banc Sabadell in 2015 is mainly due to the integration of the UK bank TSB in June, which added accounts worth €122 million. Without this operation, Banc Sabadell’s net profits would only had grown by 57.8%. Thus, net interest income, which measures the bank’s ordinary activity of receiving deposits and authorising credit, was €3.203 billion, 41.7% higher than in 2014. The internationalisation of Banc Sabadell has already been consolidated and 32% of the credits were authorised abroad. In 2014, this percentage was 6%. The default rate, which has dropped to 7.79%, 5 points less than in 2014, also contributed to Banc Sabadell’s positive result.

The Catalan bank Sabadell has completed the process of compulsory acquisition of all TSB Banking Group (TSB) shares, thereby taking ownership of 100% of this British entity’s share capital. The move completes the takeover started last spring, when TSB accepted the 1.7bn-pound offer made by Banc Sabadell. Through buying TSB, Banc Sabadell has expanded its international presence, with its percentage of foreign assets growing from 5% to 22%. TSB has 631 branches, 4.6 million customers and 8,600 employees in the United Kingdom.

Last April, Banc Sabadell filed a takeover offer on 100% of the shares of the UK lender TSB, partially owned by LLoyds. On Monday, the Catalan bank announced it had already exceeded the 75% minimum bid of the takeover offer, reaching 81.23% of TSB shares. However, this percentage is still likely to increase in the upcoming days, since there are 14 remaining days till the end of the takeover's acceptance period. In order to fund the transaction, the Catalan corporation will carry out a €1.61 billion capital increase (€1,607 million). Current shareholders have a preference call in this capital increase. Banc Sabadell, is one of the few banks to emerge stronger from a financial crisis that has redrawn Spain’s banking sector. Unlike many of its Spanish rivals, the bank is in good shape reporting a 50% increase in annual profits at the end of 2014 to €371.7 million. Since 2007, it has doubled in size and is now Spain’s 5^th largest bank. It achieved this mainly through an energetic programme of acquisitions in Spain and abroad. 

Last week, TSB announced Banc Sabadell's interest in purchasing all of the shares of the British bank, which is partially owned by Lloyd's. The board of the 6^th largest bank in the United Kingdom then said they would welcome the Catalan bank's takeover bid, which they set at £3.40 per share (equivalent to €4.80). This meant that Banc Sabadell would buy TSB for £1.7 billion, or €2.4 billion. At that time, the Catalan bank denied any definitive agreement had been reached and simply confirmed that there were some talks in progress. A week later, Banc Sabadell has finally announced and approved the takeover bid, on the same terms released last week. In order to fund the transaction, the Catalan corporation will carry out a €1.6 billion increase in capital. This purchase will significantly strengthen Banc Sabadell's internationalisation, dramatically increasing its presence in the UK and in London's financial circles.