Potential BBVA-Sabadell merger would create one of western Europe’s 10 largest banks

A merger between BBVA and Banco Sabadell would create one of western Europe’s 10 largest banks, and Spain’s second-largest bank by domestic market share, widening the gap between the country’s largest banks and second-tier banks.

BBVA disclosed plans on Wednesday for a bid for Spain’s fourth-largest bank by assets, involving an equity swap representing a 30 per cent premium of Sabadell’s market valuation as at April 29. If BBVA’s bid is successful, Banco Sabadell shareholders would hold a 16 per cent stake in the resulting entity.