UK bank TSB could be sold off by Spanish owner Sabadell

The Spanish bank Sabadell has said it has received interest from prospective buyers of its UK division TSB, and said it would assess any firm offers it may receive.
Sabadell wants to sell TSB as it battles to fend off an €11bn (£9.4bn) hostile approach from its Spanish rival BBVA.
The Catalonia-based lender said it had received 'preliminary non-binding expressions of interest' for TSB from unnamed bidders, and would examine any potential binding offer.
TSB has more than 5 million customers, and made headlines during a large-scale IT meltdown in 2018.
Sabadell acquired TSB, which was previously owned by Lloyds Banking Group, for £1.7bn a decade ago. At the time, the bank wanted to 'internationalise' and expand outside Spain.
However, the lender, which was created in 1881 by 127 families in Catalonia with the aim of financing local industry, has been locked in a prolonged takeover battle with BBVA for more than a year, casting uncertainty over TSB's future.
Spain's socialist-led government, which has been opposed to a combination of the two big banks, last month carried out a full review. Together, BBVA and Sabadell would be the second-biggest player in the loan market, ahead of Santander but behind CaixaBank.
The European Commission said last year it did not have any objections to the takeover of Sabadell after completing a foreign subsidies review.
In November, TSB appointed Marc Armengol as chief executive, and he took over at the start of this year. He is a former strategy director at TSB who has served on the board since 2022, and originally joined Sabadell in 2002.
Sign up to Business Today
Get set for the working day – we'll point you to all the business news and analysis you need every morning
after newsletter promotion
A sale of TSB could generate between £1.7bn and £2bn, a source told the Financial Times.
Also on Tuesday, the Irish government said it had sold its remaining shareholding in AIB Group, one of the country's two biggest lenders. It was nationalised 15 years ago as part of the eurozone's biggest state rescue during the financial crisis.
The government sold a 2.06% stake in AIB at €6.94 a share, which will generate €305m, the finance ministry said. This will take the total returned to the state from its investment to €9.8bn.

Try Our AI Features

Explore what Daily8 AI can do for you:

Learn with AIFact CheckingText to SpeechAI Summary

Related Articles

Times

26 minutes ago

• Times

What a TSB bank sale could mean for customers

TSB, one of Britain's biggest high street banks and mortgage lenders, has been put up for sale by its Spanish owner. Banco Sabadell is looking to sell TSB as it battles to fend off an €11 billion (£9.4 billion) hostile takeover from its Spanish rival, BBVA. Potential UK bidders for the high street bank include NatWest, Barclays, Santander and HSBC. TSB has more than 5 million customers, about 5,000 staff and 175 branches in the UK. Any offer for the bank would need shareholder approval and a sale would take time to finalise. We look at what it could mean for millions of TSB customers and shareholders. • Business live: follow the latest news on companies, markets and economics The primary driver is BBVA's drawn-out attempt to make a hostile takeover of Sabadell. Selling TSB could raise significant capital, which Sabadell could use to reward shareholders and make the company a tougher target for a BBVA acquisition. If BBVA does succeed in taking over Sabadell, the expectation is that it would look to sell TSB anyway. Sabadell bought the bank from Lloyds Banking Group for £1.75 billion in 2015. TSB said that for now, it's 'business as usual,' and customers shouldn't need to do anything differently. The bank is expected to remain a UK-based entity and will continue to be covered by the Financial Services Compensation Scheme (FSCS), which protects deposits of up to £85,000 if the firm holding your money fails. If TSB were sold, current accounts would probably be switched to the new owner. Those unhappy with a change could easily move banks using the Current Account Switch Service, which pledges to transfer customer deposits, direct debits and standing orders within seven days. While TSB has offered competitive current account deals in the past (such as its Classic Plus account, which offered cashback and savings features), some of its savings deals have not always been the most competitive. TSB now offers two current accounts. The Spend & Save account pays £5 a month cashback if you make 20 payments in a calendar month. It also gives you access to an easy access saver paying up to 2.05 per cent (which includes a 1.04 percentage point bonus for a year). • From threats to inviting us to tea: SJP changes its tune (and fees) The Spend & Save Plus account, which costs £3 a month, offers the same perks plus £100 interest-free overdraft and an easy access regular saver paying up to 5 per cent on up to £250 a month. The backing of another, potentially larger bank and an injection of capital could allow TSB to launch more attractive products and interest rates and become a stronger player in the market. TSB had £33.9 billion worth of mortgage lending on its books at the end of 2023, according to the banking association UK Finance. It can be worrying when the lender in charge of your mortgage changes hands, but it's not unusual — and TSB went through the process at its last sale in 2015. Any transfer would also be overseen and closely monitored by the Bank of England and the Financial Conduct Authority, the City watchdog, to protect customers. A new owner could change interest rates offered to borrowers starting a new mortgage deal, but those locked into a fixed rate would stay on the same terms and conditions until that deal expired. About 10 per cent of TSB's shares were held by private investors who bought them at £2.60 each when the bank floated on the stock exchange in June 2014. These were later sold to Sabadell when it acquired the bank in 2015. While no official price has been disclosed, sources familiar with the bank suggest that a sale could generate up to £2 billion. Laith Khalaf at the wealth manager AJ Bell said that if the bank were sold, those investors would get a windfall of up to £129.20 as well as the profit on selling shares at the £3.40 price offered by reported pre-tax profits of £285.1 million on income of £1.14 billion last year, up 21.1 per cent on the £235.5 million earned in 2023. It had total assets of £46.1 billion at the end of 2024.

Reuters

20 hours ago

• Reuters

Spain's commitment to NATO 'total', defence minister says

MADRID, June 20 (Reuters) - Spanish Defence Minister Margarita Robles said on Friday her country is totally committed to NATO, a day after Madrid asked the alliance to be exempted from the proposed increase in the defence spending target to 5% of gross domestic product. "Spain and its armed forces are a serious, trustworthy, responsible ally that is absolutely committed to the European Union and the Atlantic Alliance," Robles said in Madrid. "No one can call it into question." Her comments came following a letter by Prime Minister Pedro Sanchez to NATO chief Mark Rutte on Thursday that could derail a summit at which the military alliance plans to ask them to commit to the 5% target. In his letter, Sanchez requested a "more flexible formula" that either makes the spending target optional or excludes Spain from its application. At an estimated 1.28% of GDP, Spain had the lowest proportion of expenditure on defence in the alliance last year, according to NATO estimates. Sanchez agreed in April to accelerate efforts to meet NATO's current target of 2% this year.

The Independent

a day ago

• The Independent

Judge rejects Airbnb's appeal in move that could change Spanish tourism forever

A Spanish court has upheld an order for Airbnb to block nearly 66,000 rental listings across the country, rejecting an appeal from the online platform. The ruling reinforces the government's stance that these short-term rentals violate local regulations and contribute to Spain 's escalating housing crisis, particularly as the nation experiences record tourist numbers. The Consumer Rights Ministry had previously flagged the listings for violations, issuing an order last month for Airbnb to remove 65,935 properties. Of these, 5,800 were identified for immediate takedown. An Airbnb spokesperson could not be immediately reached for comment on the Madrid 's High Court 's decision. The ministry has said the listings it flagged did not include their license number or specify whether the owner was an individual or a company. It said others listed numbers that didn't match what authorities had. Last month, Consumer Rights Minister Pablo Bustinduy told The Associated Press that the tourism sector could not "jeopardise the constitutional rights of the Spanish people.' This included their right to housing and well-being. Carlos Cuerpo, the economy minister, said in a separate interview that the government had to tackle the unwanted side effects of mass tourism. It comes following protests across Spain and popular European hotspots. Earlier this month, protesters used water guns against unsuspecting tourists in Barcelona and on the Spanish island of Mallorca as demonstrators marched to demand a rethink of an economic model they believe is fuelling a housing crunch and erasing the character of their hometowns. The marches were part of the first coordinated effort by activists concerned with the ills of overtourism across southern Europe's top destinations. While several thousands rallied in Mallorca in the biggest gathering of the day, hundreds more gathered in other Spanish cities, as well as in Venice, Italy, and Portugal's capital, Lisbon. 'The squirt guns are to bother the tourists a bit,' Andreu Martínez said in Barcelona with a chuckle after spritzing a couple seated at an outdoor café. 'Barcelona has been handed to the tourists. This is a fight to give Barcelona back to its residents.' Martínez, a 42-year-old administrative assistant, is one of a growing number of residents who are convinced that tourism has gone too far in the city of 1.7 million people. Barcelona hosted 15.5 million visitors last year eager to see Antoni Gaudí's La Sagrada Familia basilica and the Las Ramblas promenade. Martínez says his rent has risen over 30 per cent as more apartments in his neighborhood are rented to tourists for short-term stays. He said there is a knock-on effect of traditional stores being replaced by businesses catering to tourists, like souvenir shops, burger joints and 'bubble tea' spots. 'Our lives, as lifelong residents of Barcelona, are coming to an end," he said. "We are being pushed out systematically.'