Finance & economics | Bona fide

Against expectations, European banks are thriving

Many are now ripe for a takeover

The Unicredit SpA headquarters in Milan, Italy
Photograph: Getty Images

In 2020, when BBVA and Sabadell abandoned merger discussions, it was difficult to find investors with anything positive to say about European banks. A decade of near-zero interest rates, stiff regulation and anaemic economic growth had made them unprofitable and unattractive. The two Spanish lenders were no exception. BBVA had a market value of €26bn ($32bn), less than 40% of its 2007 peak. At €2bn, Sabadell was worth only a fifth of the accounting (“book”) value of its equity.

This article appeared in the Finance & economics section of the print edition under the headline “Bona fide”

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