Banking analysts in Spain have greeted with positive signals Sabadell United Bank’s (SUB) latest acquisition in Florida, after the Banc Sabadell subsidiary won the Federal Deposit Insurance Corporation-arranged bid for Lydian Private Bank. SUB purchased $1.607bn in assets with a discount of $176 million, and an estimated $1.224bn in clients’ deposits –other liabilities include a £351-million credit from the Federal Home Loan Bank.
Grupo Renta 4 notes that “SUB increases substantially its size, as it becomes the 7th local bank by revenue in the state of Florida.” In fact, the operation has injected 67 per cent of SUB’s current total assets and 63 per cent of its deposits. Prior to the deal, SUB ranked 12th in the list of Florida banks by business size. At Renta 4, though, they dismiss its impact on the Banc Sabadell’s overall standing because “SUB represents 2.6 per cent of the Catalan financial institution’s net profits.” Bankia says it has been a “good decision followed by a good outcome” as SUB’s move is in line with the strategy of Banc Sabadell in the region.
SUB has expanded its branch numbers to 25 across Miami-Dade, Broward, Palm Beach and Palm Beach Gardens, Tampa, Sarasota, Naples and Coral Gables. The Catalan subsidiary’s business volume in the US 4th largest state has reached $10.7bn, that is a 51 per cent more than before the acquisition. Ahorro Corporación indicated that it now expects a rise in SUB’s profitability from a loss-share agreement that will leave 80 per cent of value damages in FCIC’s hands for certain troubled assets.
Lydian Private Bank is the 10th bank failure in Florida and the 66th in the US.