Historic rise in BBVA stock following announcement of sale of US subsidiary
News of the sale of the US subsidiary to PNC strongly boosted BBVA's stock market performance. The market warmly received the deal with a rise in the stock price of 15.3% at close on November 16, the third highest in the bank's stock market history and a new record in outperformance by the European banking sector: the Dow Jones index for US banks scored just 3.3% in the session, 12 percentage points behind.
The deal involves the sale of the US subsidiary for US$ 11.6 billion (€9.7 billion, at an exchange rate of 1.2 dollars per euro) in cash. The transaction will have a positive impact on BBVA's fully loaded CET1 capital ratio of nearly 300 bp, or €8.5 billion of CET1 generation.
BBVA's stock market momentum continued throughout the day. The stock closed at €3.66, making for an historic revaluation of 15.3%. Since October 30, BBVA's shares rose 48.6% (compared to a 27% rise in the DJ Stoxx bank index). Hence the stock halved its decline since the beginning of the year, to -26.50%, in line with the fall in the DJ Stoxx for US banks over the same period (-26.2%).
At the close of yesterday's market, November 16, BBVA confirmed in a significant event (price-sensitive disclosure) that it had talked with negotiators acting for Banco de Sabadell.