Cross-border bank consolidation heats up
Shares in Portugal's Banco BPI rose by a record 26pc yesterday after Spain's CaixaBank offered to buy out investors in a bid to become the largest lender in the Iberian region.
CaixaBank, which controls 44pc of BPI, is offering as much as €1.1bn or €1.329 in cash per share, the company said in a regulatory filing. BPI shares gained 26pc on the news, while CaixaBank's own stock fell 1.3pc to 4.053 in Madrid.
CaixaBank, which bought Barclays' banking operations in Spain in September, is seeking to expand in Portugal as BPI prepares to bid for rival Novo Banco. The BPI purchase will provide annual cost savings of about €130m euros by 2017, CaixaBank said, adding that it may have to raise capital if the offer is accepted.
"This deal clarifies in our view CaixaBank's M&A strategy in Portugal," said David Vaamonde, an analyst at MainFirst Bank.
"We believe that this is Caixabank's initial step to bid for Novo Banco, something that would put the Spanish bank's capital ratios under pressure in light of the impact that the acquisition of a majority stake in BPI would have."
BPI has said it may bid for Novo Banco, the lender that emerged from the breakup of the country's Banco Espirito Santo.
Banco BPI chief executive Fernando Ulrich said last month that the lender would rely on its shareholders and, if necessary, capital markets to invest in new projects.
CaixaBank said it wants to keep a common equity ratio under fully-loaded Basel III rules of above 11pc after the transaction, to continue to be among the European banks with largest buffers.
All options are open, CaixaBank's Gonzalo Gortazar has said.