Sabadell Bank has reported record profits for 2024, posting €1.83 billion, up 37% from last year. The Spanish lender is also rewarding shareholders with €3.3 billion, including €1 billion in buybacks. This comes as Sabadell faces a hostile takeover attempt by BBVA.
Record Profits and Shareholder Payouts
Sabadell plans to increase its 2024-2025 shareholder payout target to €3.3 billion, up from €2.9 billion. This includes 20.44 cents per share in dividends for 2024, with at least the same amount for 2025. Additionally, shareholders will receive approximately 61 cents per share through buybacks over the next two years.
Chairman Josep Oliu highlighted the bank’s record returns, stating, “No other Spanish bank plans to match this level of income distribution.” CEO César González-Bueno expressed confidence in their strategy, saying, “With record profits in 2024, we’re confident our strategy will drive sustainable growth and long-term shareholder value.”
Strong Performance Drives Success
Sabadell’s success is attributed to its strong retail and business banking performance in Spain, as well as the contributions from its British subsidiary, TSB. TSB reported a net profit of £208 million, an 18.9% increase from last year, contributing €253 million to Sabadell’s group earnings. This is the highest contribution since TSB’s 2015 acquisition.
Net interest income also rose by 6.3%, totaling €5.02 billion by the end of 2024, driven by higher lending rates.
BBVA Takeover Battle
Sabadell’s profit announcement coincides with its ongoing resistance to a hostile takeover bid from BBVA. This marks the second time in four years that BBVA has attempted to acquire Sabadell. Sabadell argues that BBVA’s bid undervalues its business and growth potential.
While proponents of the merger argue it would increase Spain’s lending capacity, critics worry about monopolistic practices. Spain’s antitrust authority, CNMC, has extended its review of the deal, potentially delaying it into late 2025. Experts suggest that the delay could hurt BBVA’s chances of completing the takeover, as the regulator may demand more concessions.
The Spanish government initially opposed the merger, but Prime Minister Pedro Sanchez has now stated that the government will respect CNMC’s final decision, although it still retains the authority to block the merger. Catalan politicians remain opposed, fearing the merger would reduce Sabadell’s economic influence in Catalonia.
Sabadell’s record profits and shareholder payouts demonstrate its strong performance and independence, as the bank continues to resist BBVA’s hostile takeover bid. With its successful strategy, Sabadell aims to maintain its position as a standalone entity.