Spanish bank may bid for Clydesdale Bank, says report

The Sunday Times claims that Sabadell is also considering a bid for Williams & Glyn, which is an offshoot from Royal Bank of Scotland (RBS).

Sabadell, Spain’s fifth-biggest bank, bought TSB earlier this year, with the aim of growing the bank to challenge Britain’s “Big four” lenders.

TSB was spun out of Lloyds Banking Group last year after Lloyds was ordered to sell the business by European regulators as a condition of its £ 20.5 bn bailout during the 2007-9 financial crisis. The Sunday Times said that a Sabadell-led merger of TSB and Clydesdale would create a player with seven per cent of retail accounts.

An un-named senior financial services banker told the paper: “Sabadell wants to load more assets onto TSB and is keen to do deals. There are banks of a certain size that will be looking at one another. There are various potential outcomes.”

In July, Paul Pester, TSB’s chief executive, said: “The completion of the Sabadell Group’s acquisition of TSB at a premium of over 30 per cent to our IPO share price is recognition of the excellent progress and great potential of the bank. We remain unwavering in our mission of bringing more competition to UK banking and, with the extra firepower of Sabadell behind us, we look forward to accelerating our growth plans and continuing to take on the big banks that have had a stranglehold on the UK market for far too long.”

In July, National Australia Bank (NAB), which owns Clydesdale Bank, said work on a potential demerger and IPO - initial public offering - by way of an institutional offer of Clydesdale was continuing.

Yorkshire and Clydesdale’s new CEO, David Duffy, highlighted Yorkshire and Clydesdale’s established presence in the retail and SME (small and medium-sized) banking sectors. He said they were well placed as challenger banks, given their position as the UK’s largest mid-sized lenders.

Responding to the Sunday Times report, a Clydesdale Bank spokesman said: “We don’t comment on market rumours and speculation.

“NAB was clear in its trading update last month that substantial progress has been made towards its intention to pursue a demerger and IPO offering.”

An observer with knowledge of Clydesdale’s position said that “while there will always be rumours, it would not distract NAB from its clear, stated aim of delivering a demerger and float in the near term.”

An RBS spokesman also declined to comment on the report.

On its plans for Williams & Glyn, the RBS spokesman said: “Williams & Glyn will play an important role in the UK banking landscape and will be an excellent addition to the market.

“We are moving forward towards an IPO by the end of 2016.”

A TSB spokesman said the bank did not comment on rumour or speculation. Sabadell declined to comment on the report.

The Yorkshire Post understands that Sabadell is focusing on devising and implementing the integration plans with TSB.