PNC To Buy US Branch Of Spain’s BBVA For $11.6B

Spanish financial group BBVA has agreed to sell its US business, BBVA USA Bancshares, to PNC Financial Services Group for US$11.6 billion, the Wall Street Journal reported on Monday, November 16.

Headquartered in Houston, Texas, BBVA USA Bancshares has US$104 billion in assets under management, with banking subsidiary BBVA USA operating 637 branches in Texas, Alabama, Arizona, California, Florida, Colorado, and New Mexico. The new company will have a coast-to-coast presence in 29 of the 30 largest markets in the US, PNC announced on Monday.

The all-cash deal is the second-largest US banking acquisition since the 2008 financial crisis, according to Reuters, and values the American business at 19.7 times its 2019 earnings and 1.34 times its book value as of September 2020.

In a statement, BBVA Group Executive Chairman Carlos Torres Vila said the deal was a “very positive transaction for all sides” and enhanced the Spanish group’s “already strong financial position.”

“We will have ample flexibility to profitably deploy capital in our markets strengthening our long-term growth profile and supporting economies in the recovery phase, and to increase distributions to shareholders,” Torres Vila added.