Onur Genç, CEO of BBVA: “We expect the combination with Banco Sabadell to be approved with its full value creation potential”
“We believe that the combination will create significant value for the shareholders of both Sabadell and BBVA, as well as for society in general,” remarked BBVA’s CEO, Onur Genç, while taking part in the 31st Financial Industry Conference organized by ABC and Deloitte. In relation to the ongoing process, the bank’s CEO cited the decision reached on Tuesday, November 12, by the CNMC (Spain’s national competition authority) to commence phase two of the analysis. “We expect the combination to be approved with its full value creation potential.” If this is not the case, i.e. if value creation is compromised, BBVA has the option to withdraw: “We will not hesitate to walk away if it will not create value,” cautioned the bank's CEO. “BBVA will continue to work closely with the authorities to finalize, as soon as reasonably possible, any commitments that may be needed to alleviate any concerns they may have and to get the operation approved.”
According to Onur Genç, the banking sector needs players with greater scale and efficiency, thus enabling it to increase its investment capacity, especially in technology. “And in our view, that larger investment capacity comes from gaining scale. Big players are more efficient because they spend the same on technology as smaller banks, yet they make a higher profit because they have more customers. If they are more efficient, they are increasingly profitable, and if they are more profitable, they have greater investment capacity,” he explained. In that regard, “we firmly believe in the value creation potential of this transaction because it will create a strong, large-scale player. The economic logic is undeniable.”
Along the same lines, he believes that “Europe needs financial champions” to help boost the growth of the European economy. To succeed, “Europe needs investments,” and these investments require banks with sufficient scale. Onur Genç recalled that of the world’s 25 top banks measured in terms of market capitalization, none of them come from the European Union. “To create European champions, we first need domestic champions,” he concluded.
Positive outlook across its main markets: Mexico, Spain and Türkiye
BBVA is looking ahead with optimism, supported by its strategy of profitable growth and sound risk management. “We see very positive signs for the business, which could allow us to maintain similar levels of profitability (ROTE) in 2025 as this year.” We are right at the forefront of European banking in terms of profitability, and we aim to stay there,” proclaimed Onur Genç.
The CEO underscored the value of BBVA’s geographic diversification model, which allows it to cope with changes in the economic cycle in a given market. He also referred to the leadership of BBVA’s franchises in terms of profitability across the main markets in which it operates: Mexico, Spain, Türkiye and South America. Focusing on BBVA’s franchise in Mexico, he noted that “I’ve seen many banks in my life, but what BBVA has in Mexico is genuinely unique.” Onur Genç also pointed to the sustained growth in customers over time: “In each of the last three years, BBVA has managed to attract 11 million new customers.” In his opinion, this combination of profitability and growth affords BBVA a privileged position when compared with its competitors.
Indeed, BBVA has reported sustained loan growth across its main markets in recent months. Moreover, it has achieved this growth in a profitable manner, in terms of return on capital. Loan growth in both Spain and Mexico is key, with the market share rising in both markets. In Spain, the market share is close to 14 percent, while in Mexico, it has grown to 25 percent. BBVA also arranges currency hedges to shield itself against exchange rate fluctuations and its credit quality indicators have remained stable in recent months.
