Giant Spanish bank BBVA has sold it’s US retail arm PNC in an $11.6bn (€ 9.79bn) deal that will create the fifth-largest US bank by assets as well as delivering much needed cash for the Spanish operations.
Bill Demchak, PNC’s chief executive told the Financial Times that “BBVA is in the best markets in the country with substantial presence down in Texas, Arizona, California and in Denver, in Alabama, and down through Florida.”
Shareholders in Madrid responded positively to the news and their shares surged by nearly 20% in early trading this morning.
Carlos Torres, BBVA’s chairman, said that the sale “enhances our already strong financial position”, and comes months after the announcement of the sale of Bankia to La Caixa bank.
European and Spanish regulators have expressed concern at the relative weakness and fragmentation of the Spanish banking sector amid the ongoing economic fallout from the coronavirus pandemic.
The Spanish economy is forecast to contract by 12% in 2020 before recovering by 4.5% and 4% respectively in 2021 and 2022.