Banco Sabadell has surprised the Iberian market by leaving the door open for a future sale of its Andorran subsidiary. Its CEO, Jaime Guardiola, has recognized that “For the Principality's domestic banking, four players are many and sooner or later a process of concentration will come. " In addition, it has advanced that the bank does not contemplate entering into losses in the whole of 2020 despite the fact that, due to the coronavirus crisis, until June it had registered a 73% lower profit after provisioning almost 1,100 million euros.
In Andorra, the banks present -Crèdit Andorrà, Andbank, Morabanc and, to a lesser extent, Vall Banc- are engaged in two major activities, domestic banking and international banking. In the case of BancSabadell d'Andorra, founded in 2000 and the smallest of the great ones, it focuses only on the first of the activities, although “it is the one that has grown the most in recent years, with a 'flight to quality ' quite clear". Although "it is not in our equations", the CEO of the group believes that there is not enough space for so many entities focused on domestic banking and, therefore, they will study "in the future" the situation of the market and its subsidiary in the Principality.
At a consolidated level, Guardiola has lowered market expectations about a possible corporate merger or sale operation of the bank in Spain. "We can continue alone", has stated emphatically. In any case, and in sectoral terms, he thinks that they think "More logical" national mergers, because "they give more value to investors and generate more synergies", although he understands that "a gap is opening in Europe for cross-border mergers".
Regarding the 'veto' of the dividends of European banks by the ECB until next January 1, 2021, the director has indicated that the council will study the possibility of distributing benefits again next year depending on what establish the body chaired by Christine Lagarde. However, when that time is, rules out making a 'scrip dividend' as Santander has announced: "Our position is to pay them in cash."
LITTLE CONCERN FOR MEXICO
The Catalan bank, also present in the United Kingdom through TSB and in Mexico with its own subsidiary, does not fear the performance of this second -as it happens to BBVA, the great bank of the aztec country- for the scarce economic and fiscal aid from the Andrés Manuel López Obrador government (AMLO) to the local crisis caused by Covid-19.
"It is not important to us that the Mexican government has not made aid. These grants have more to do with SMEs and individuals, and we are not in those segments there. We are dedicated to ‘project finance’ and corporate operations, and that world is not so relevant for an aid program ”, Guardiola has reassured. "We are noticing less the effects of this lack of use of public funds in the resolution of the crisis," he added, referring to the difficult situation of BBVA in this North American market.
Banco Sabadell has also used the occasion to clarify that the sale agreement of 100% of its manager, Sabadell Asset Management, to the French Amundi just It is limited to the Spanish market. Therefore, neither its investment funds nor those of the gala will be distributed in the United Kingdom, through TSB, or in Mexico.
However, Guardiola stressed that "we are very happy with this agreement" and that "the relationship with Amundi is splendid." The Catalan bank already has several sustainable funds at its disposal from the French firm, and they are working together to design treasury funds for corporations.
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