CNMC authorizes Bankia-Caixabank merger beneath situations
The Spanish competitors authority (“CNMC”) Approved the acquisition by Caixabank of the general public monetary entity Bankia in part I, topic to situations. This transaction offers rise to the merger between the third and fourth Spanish monetary entities, with 660 billion euros in property. As well as, the brand new entity is predicted to dominate the Spanish banking companies market, notably within the retail banking segments.
In line with the CNMC, the merger impacts the next markets, the place each events are concurrently current: banking companies (retail banking, company banking, funding banking and factoring); Level of sale (“POS”); ATM (“AT M”); insurance coverage manufacturing and distribution; and the administration of pension plans and funds.
With the intention to address the competitors dangers noticed in the course of the analysis, Caixabank proposed a sure variety of cures which enabled the CNMC to present the inexperienced mild to the acquisition challenge.
1. Competitors dangers recognized by the CNMC
After analyzing the impression of the transaction on the markets involved, the CNMC concluded that it was solely capable of increase competitors considerations in sure segments of the retail banking market and within the ATM market. computerized.
Concerning the department phase of the retail banking market, CNMC has detected that the proposed merger will result in a extremely concentrated market in a number of Spanish areas. Because of this, the CNMC carried out an evaluation of the native market and recognized 86 postal codes the place the ensuing entity would both be the one financial institution current (i.e. giving rise to a monopoly state of affairs) or topic to a low aggressive stress resulting from a duopoly state of affairs.
The CNMC concluded that no or decreased aggressive stress in these areas would give the ensuing entity excessive market energy which might have detrimental results for customers. Specifically, the CNMC has highlighted a danger of monetary exclusion in areas the place solely collaborating firms are current, resulting from the potential for closing one of many branches in these areas after the merger. The CNMC additionally identified that in areas the place the ensuing entity could be topic to low aggressive stress, the enterprise situations of Bankia’s present clients might deteriorate.
As well as, with regard to the ATM market, in keeping with the CNMC, clients of competing monetary entities which have entered into agreements with Bankia (resembling ING, Banco Sabadell and banks belonging to the Euro6000 community), might undergo detrimental penalties. in case of failure. of mentioned agreements following the merger. This example would stop them from accessing Bankia’s ATM community beneath the identical situations as earlier than.
2. Cures proposed by the events
Within the mild of the competitors considerations recognized by the CNMC, the events proposed a number of cures to acquire the authorization of the focus. Extra particularly, in view of the dangers of monetary exclusion and the potential deterioration of buyer situations, Caixabank has undertaken to take the next measures:
- Refuse to go away any municipality through which one (or each) of the events is current and there aren’t any competing entities.
- In postal codes the place Caixabank would profit from a monopoly state of affairs, don’t change the present phrases and situations for Bankia clients.
- For a interval of three years, in postal codes the place Caixabank is in a duopoly state of affairs, it ought to provide its merchandise beneath the identical situations as these supplied in areas the place it’s topic to stronger aggressive stress.
- Inform Bankia’s purchasers each of the completion of the merger and of potential developments in monetary merchandise that would have an effect on them (i.e. new relevant charges, new, comparable or higher merchandise, and so on.).
As well as, with regard to the dangers arising from current ATM agreements, Caixabank has undertaken to supply clients of ING, Banco Sabadell and banks within the Euro6000 community entry to ATMs that already belonged to Bankia earlier than the merger. , for a interval of 18 months and beneath the identical financial situations. And, in circumstances the place Bankia’s ATMs have been closed on account of the merger, Caixabank has additionally dedicated to offering the identical clients with entry to the closest Caixbank ATM.
3. New mergers on the horizon within the Spanish banking sector
Given the relevance of the 2 merged entities, there isn’t any doubt that this can be a landmark transaction. Nonetheless, he’s not anticipated to be the final on this trade within the close to future.
Certainly, the Spanish monetary market has step by step tended to pay attention for the reason that 2008 monetary disaster, and not less than one different merger between two Spanish monetary entities involved is already deliberate to create the nation’s fifth financial institution, which shall be topic to the CNMC. merger management evaluation.