The Mexican government has granted a crucial authorization to BBVA that could positively influence the merger process with Sabadell, according to an executive from the sector consulted by LPO. This approval would facilitate BBVA presenting itself as an attractive partner in Spain and attracting more shareholders to support the merger.
Last week, BBVA closely collaborated with the Ministry of Finance to carry out a successful debt placement of 28 billion pesos, at a time when expectations are affected by the new U.S. administration.
The economic regulatory entity faced no difficulties in approving the merger since Sabadell's presence in Mexico is insignificant compared to that in Spain: BBVA has a 30% market share while Sabadell barely reaches 3%, which ruled out risks of economic competition.
This measure was interpreted in the sector as a gesture from the Mexican government towards the private sector amidst tensions generated by possible impacts from Donald Trump's trade decisions. Furthermore, it was seen as a signal to the financial community that the government favors investments.
Although in Spain the merger between BBVA and Sabadell still lacks a defined direction, in Mexico the regulatory authorities have already green-lighted the operation in a remarkably swift review. It is surprising that the National Banking and Securities Commission (CNBV), usually slow in its processes, validated the deal before it was finalized in Spain.
