MADRID (S&P Global Ratings) April 5, 2021--S&P Global Ratings said today that the acquisition by Abanca Corporación Bancaria S.A. (Abanca; BB+/Stable/B) of Novo Banco's Spanish banking business (NB Spain) will only slightly erode its capitalization. While the acquisition price is undisclosed, we expect it to be lower than NB Spain's book value. We also expect Abanca to use the potential badwill primarily to build up provisions and for restructuring purposes. Based on the information currently available, we anticipate that the acquisition will erode Abanca's risk-adjusted capital (RAC) ratio by about 10-20 basis points. Therefore, we would expect Abanca's RAC ratio to remain above 7.0% on a sustainable basis, and to hover around 8.5% by end-2022, yielding enough of a buffer
