Banking News
- BBVA to focus on China, U.S. markets
Date: 6-Mar-2007 Sources: (Shenzhen Daily)
BANCO Bilbao Vizcaya Argentaria SA (BBVA), Spain's second-largest bank, is in no hurry to buy more lenders as it digests acquisitions in China and the United States, where it hopes to create a number of joint ventures, its chairman said Friday.
Speaking one day after closing a deal to spend US$1.3 billion on buying stakes in China's CITIC Bank and its Hong Kong-listed international arm, Francisco Gonzalez said that BBVA needed to consolidate its position after agreeing last month to pay US$9.6 billion to buy U.S. bank Compass Bancshares.
The Madrid-based lender needed to focus its attention on China and the United States, he said.
Apart from flexing its muscle in the United States, BBVA would develop its partnerships with the two entities operated by CITIC group, Gonzalez said.
As part of the deal, first unveiled in November, BBVA agreed to purchase 5 percent of China CITIC Bank and 15 percent of Hong Kong-listed CITIC International Financial Holdings Ltd.
Now that the deal had closed, BBVA would move on to the next stage of its partnerships, which could include doubling its investment in China by raising its stakes in CITIC Bank and CITIC International.
As part of November's agreement, BBVA has an option to raise its stake in CITIC Bank to 9.9 percent following its listing.
BBVA executives have said previously that the bank was negotiating options to increase its interest in CITIC International to as much as 36 percent.
Gonzalez reiterated BBVA's desire to raise its stakes to approximately such levels, a move that he said could mean investing a further 1 billion euros in China by early 2008, depending on valuations.
Over the coming weeks, BBVA would hammer out plans to tap the Chinese mainland's retail market with CITIC Bank and to develop largely wholesale activities in Asia with CITIC International.
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