FROB Relinquishes Catalunya Banc´s Offices Sale to Dodge State Assistance

30/05/2014 – El Confidencial

 The FROB (Spain´s Fund for Banking Restructuring) surrendered on seeing the meagre interest in the auction of Catalunya Banc´s 196 offices out of its region: it decided they will be sold together with the nationalized entity, not separately.

The fund received only two offers, from Popular and EVO Banco, which aimed at parts of the package and required public assistance. Adding the offices to the core sale will considerably pull down the value of the bank as shedding the network was supposed to cleanse the balance sheets. The fiasco contrasts with the success of the entity´s loan portfolio sale.

Popular´s offer targeted 80 offices in the Valencian Community and Aragon, while EVO bidded for a similar number of units scattered all around Spain to expand outside of Galicia.

Facing more public aid, the FROB could either add it to expenses for banking bail-out or give the sale up. Given that the loan portfolio sold in parallel already takes a €1.5 billion assitance from the fund, it opted for the other path. In fact, the guarantee was the key factor to fuel such an enormous interest in the “Hercules Project”.

 

Original article: El Confidencial (by Eduardo Segovia)

Translation: AURA REE

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