La Caixa on the "lookout" to buy other savings banks
Earnings fall last year as listed arm Criteria's shares soar
Just a day after announcing its conversion into a commercial bank, Spanish savings bank La Caixa said Friday it was on the "lookout" for any opportunities that present themselves in the consolidation of the domestic financial sector.
La Caixa announced Thursday that it was transferring its banking business to its listed investment holding arm Criteria, including its stakes in foreign financial institutions such as Hong Kong's Bank of East Asia and Austria's Erste. At the same time, La Caixa will absorb Criteria's stakes in industrial companies such as Repsol, Telefóncia, Gas Natural and Abertis.
Criteria will be transformed into a commercial lender under the name of CaixaBank. The new bank will have a book value of some 20.6 billion euros, placing it among the top 10 lenders in the euro zone. It will start off with a core capital ratio of 10.9 percent after a convertible bond issue, higher than that of Spain's biggest lenders Santander and BBVA.
Criteria's share price jumped almost 17 percent on Friday after trading in the stock was suspended the previous day.
Criteria Chief Executive Gonzalo Gortázar said he believes the makeover of the domestic financial sector, which has seen the number of savings banks reduced to 17 from 45, is not over. "If there are opportunities and if they make sense, and we see value in these operations, then we will study them seriously," he told a news conference.
La Caixa on Friday reported its net income for last year fell 13.4 percent to 1.307 billion euros due to higher provisions for doubtful loans. Net interest income dropped 19.8 percent due to what La Caixa Chairman Isidre Fainé described as an "irrational war" among local lenders to attract deposits.
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