Bulletin: Banco de Sabadell's Strategy For Its U.K. Business Shifts To Cost Cutting

MADRID (S&P Global Ratings) Nov. 26, 2019--S&P Global Ratings said today that it still considers Banco de Sabadell S.A.'s U.K. subsidiary TSB unlikely to contribute to the group's earnings until end-2021. Sabadell's internal capital generation will therefore rely mostly on profits generated in Spain. That said, we view the targets outlined in TSB's business plan as realistic, although profitability will remain modest given that its business profile is skewed toward mortgage lending. TSB has attracted significant media attention over the past few days: First, 18 months after the legal firm Slaughter&May was commissioned to assess the bank's problematic IT migration in April 2018, it has published its independent findings. Second, TSB has presented its business plan for the

...November 26, 2019 MADRID (S&P Global Ratings) Nov. 26, 2019--S&P Global Ratings said today that it still considers Banco de Sabadell S.A.'s U.K. subsidiary TSB unlikely to contribute to the group's earnings until end-2021. Sabadell's internal capital generation will therefore rely mostly on profits generated in Spain. That said, we view the targets outlined in TSB's business plan as realistic, although profitability will remain modest given that its business profile is skewed toward mortgage lending. TSB has attracted significant media attention over the past few days: - First, 18 months after the legal firm Slaughter & May was commissioned to assess the bank's problematic IT migration in April 2018, it has published its independent findings. - Second, TSB has presented its business plan for the next three years, which includes a significant restructuring plan and the downsizing of its branch infrastructure. Slaughter & May concluded that the new IT platform was not ready to support TSB's...

Bulletin