Banco Bilbao to buy Compass

16 February 2007

Spain's second largest bank Banco Bilbao Vizcaya Argentaria (BBVA)is to buy Alabama-based Compass Bancshares in a deal worth $9.6 billion.

BBVA is making to move to strengthen its position in the consumer market in the southern US. It also owns Texas lender Laredo National Bancshares and is Mexico's largest lender.

The deal will see BBVA take Compass's 417 branches in Alabama, Arizona, Colorado, Florida, New Mexico and Texas. The Spanish firm currently has 622 branches and assets of $47 million in the US.

A BBVA spokesman said: "The transaction allows BBVA to advance its strategy to move towards a more global group and after the transaction the US will contribute approximately ten per cent of group's earnings."

He added that the deal would be financed through a capital increase of 196 million shares of BBVA, internal resources coming from the sale of selected stakes and internal capital generation.

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