On the heels of a story about Spanish giant Santander buying Alliance & Leicester in the UK, it comes as good news in the marketplace that another Spanish giant, BBVA (Banco Bilbao Vizcaya Argentaria), is on the prowl as well.
After initially focusing on the Hispanic market in the U.S., Spain’s Banco Bilbao Vizcaya Argentaria SA is now preparing to go mainstream.
Spain’s second-largest financial company by market value after Banco Santander SA is developing an ambitious push into the Sun Belt region at a time when local rivals are retrenching after the collapse of the subprime-mortgage market.
BBVA is preparing to rebrand its network of about 650 branches in the region, most of them concentrated in Texas and Alabama, merging the financial institutions it purchased over the past four years to target a wider clientele.
The new brand, BBVA Compass, will be rolled out progressively in coming months through an investment of $30 million, recycling the name of Compass Bank. BBVA acquired Compass Bank, an Alabama-based regional bank, for $9.6 billion last year.
“Even though the business environment is getting more difficult, the timing is actually quite favorable for us,” said José María García Meyer, head of BBVA’s U.S. division. “Some banks are pulling out of some markets because they don’t have the liquidity or because they are refocusing on core businesses. Some are selling branches, and retrenching in businesses such as consumer or car loans. Some players will disappear.”
BBVA’s push mirrors the emerging presence of Spanish banks in the global arena.
Along with rival Santander, BBVA is one of the few big international banks that have been able to duck the subprime-mortgage crisis, because conservative Spanish regulation prevented financial-services companies from making significant investments outside their balance sheet.
After expanding aggressively across Latin America over the past decade, BBVA started to focus north of the Rio Grande, creating a $65 billion bank franchise that after consolidating will be No. 4 in terms of market share in Texas, behind established players such as J.P. Morgan Chase & Co., Bank of America Corp. and Wells Fargo & Co.
As my quote of the day from Warren Buffett suggests, corporate chieftans confident in their balance sheets and their businesses really enjoy a market downturn because that is when one can find diamonds in the rough at cheap prices. It seems the scavenger hunt has begun And it can’t come too early for a financial sector reeling rom this credit crisis.