Research Update: Abanca Corporacion Bancaria S.A. Affirmed At 'BBB-/A-3' On Announced Acquisition Of Eurobic S.A.; Outlook Remains Stable

Spain-based Abanca Corporacion Bancaria S.A. (Abanca) has announced that it will acquire Portugal-based Eurobic S.A. (Eurobic). While the purchase price has not been disclosed, we expect it to be significantly below Eurobic's book value, with the generated bad-will helping to cushion the impact on capital and cover integration and potential restructuring costs. We also don't anticipate that the acquisition will weaken Abanca's credit risk profile. We therefore affirmed our 'BBB-/A-3' long- and short-term issuer credit ratings on Abanca. The stable outlook reflects our view that the integrations of Eurobic and recently acquired Targobank will be smooth and Abanca will continue delivering its strategic plan and maintain a sound financial position over the next two years. On Nov. 16, 2023, S&P

...- Spain-based Abanca Corporacion Bancaria S.A. (Abanca) has announced that it will acquire Portugal-based Eurobic S.A. (Eurobic). - While the purchase price has not been disclosed, we expect it to be significantly below Eurobic's book value, with the generated bad-will helping to cushion the impact on capital and cover integration and potential restructuring costs. - We also don't anticipate that the acquisition will weaken Abanca's credit risk profile. - We therefore affirmed our '###-/A-3' long- and short-term issuer credit ratings on Abanca. - The stable outlook reflects our view that the integrations of Eurobic and recently acquired Targobank will be smooth and Abanca will continue delivering its strategic plan and maintain a sound financial position over the next two years....

Research Update