MADRID – On Wednesday, BBVA (NYSE: BBVA), the Spanish bank, committed to taking a series of measures to try to secure a green light from antitrust regulator CNMC for its proposed hostile takeover of smaller rival Banco Sabadell.
BBVA said these new commitments sought to “ensure financial inclusion, bolster lending to small and medium-sized enterprises (SMEs) and enhance competitiveness” and thus expedite authorization for the merger with Sabadell.
A Sabadell spokesperson declined to comment.
The measures, which are mainly targeted at the Catalonia and Valencia regions, include a pledge not to close branches where there is no alternative nearby and to maintain commercial terms for individuals and SMEs in areas where fewer than four financial institutions operate.
BBVA (NYSE: BBVA) also said it would preserve working capital lines for all SMEs for 18 months and maintain the current total credit volume for businesses that exclusively work with BBVA and Sabadell.
Last week, CNMC said that BBVA’s all-share offer for Sabadell must undergo a longer antitrust review that could extend the process well into 2025.
Earlier on Wednesday, the watchdog had published the technical details of its decision to take the deal into phase two.
In the report, the regulator said that it could not rule out a risk of “horizontal unilateral effects in the form of a reduction in lending to SMEs” due to the difference in diversification levels between the two lenders.
It also warned of the risks of “branches closing down in municipalities where the resulting entity has no competition” and of worsening conditions in several markets. Both lenders have a significant presence in Catalonia.
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