XM does not provide services to residents of the United States of America.

Impact of alleged spying case on BBVA difficult to assess, Spanish regulator says

<html xmlns="http://www.w3.org/1999/xhtml"><head><title>UPDATE 2-Impact of alleged spying case on BBVA difficult to assess, Spanish regulator says</title></head><body>

BBVA must update risks factors in documents to supervisor

BBVA should outline savings from Sabadell deal if no merger

Adds comment from head of Spanish supervisor in paragraph 8 and from acting Bank of Spain Governor in paragraphs 16-17

By Jesús Aguado

MADRID, June 21 (Reuters) -The potential impact of an alleged spying case on Spain's second-biggest bank BBVA BBVA.MC is difficult to estimate in terms of fines or reputational damage, the head of Spain's stock market supervisor, Rodrigo Buenaventura, said on Friday.

A Spanish High Court judge on Thursday proposed that BBVA and its former chairman stand trial for alleged bribery and disclosure of company secrets following a probe into alleged corporate spying.

A BBVA spokesperson said no criminal liability "arises for the entity from the events under investigation" and its priority had always been to cooperate fully with the courts.

The court ruling comes at a time when BBVA has launched a 12.28 billion euro ($13.12 billion) hostile takeover bid for Banco Sabadell SABE.MC.

BBVA was placed under investigation in July 2019 for hiring a private investigation agency allegedly run by former Police Commissioner Jose Manuel Villarejo. The case is part of a wider probe dating back to 2004 into Villarejo, who has denied wrongdoing.

"Cases like this can have repercussions on issuers, on people who have worked or who work with managers of the institutions, and it is difficult to foresee at this stage the consequences of possible sanctions or reputational consequences that the case may have on the issuer," Buenaventura said, adding that the bank had to update any risk factors.

None of the bank's current board were involved in the investigation.

Buenaventura also said it would be "highly desirable (for BBVA) to provide information on the synergies that would occur in the event of a takeover bid without a merger."

BBVA's bid is opposed by the Spanish government. Under Spanish law, the government cannot stop the process but has the final word on allowing a merger.

Earlier this week, BBVA Chairman Carlos Torres said BBVA's intention was to pursue a merger but if this was not possible it should still be able to achieve savings in areas such as technology.

BBVA would still have influence as a potentially large shareholder in Sabadell.

The bank has estimated annual cost savings from a merger at about 850 million euros before tax, spread over three years.

BBVA has already completed all the authorisation requests, such as the one for the European Central Bank, the stock market supervisor and the anti-trust competition authority.

The ECB, in close cooperation with the Bank of Spain, also has to give its authorisation on the deal.

Against that background, the acting Bank of Spain Governor Margarita Delgado on Friday said that until there was a final court judgement, there was no additional element in the situation.

"When it is final, the situation will be analysed at that time," Delgado said.

($1 = 0.9357 euros)

Reporting by Jesús Aguado; additional reporting Emma Pinedo; editing by David Latona and Jane Merriman


Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.

All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.

Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.

Risk Warning: Your capital is at risk. Leveraged products may not be suitable for everyone. Please consider our Risk Disclosure.