Spain's Sabadell on Thursday hit its profitability target of more than 6% earlier than expected following cost savings, lower provisions and a positive contribution from its British unit TSB. Loan loss provisions in the quarter fell 36% compared to the same period a year ago as Sabadell recovered from the COVID-19 pandemic and closed the quarter with a 6.5% return on tangible equity (ROTE), up from 5.05% in the previous quarter. "We are beginning the year by improving our performance across all margins and we are continuing to reduce costs, this is accompanied by consolidation of TSB's positive contribution," Sabadell's Chief Executive Officer Cesar Gonzalez-Bueno said in a statement.
MADRID (Reuters) -Spain's Banco Sabadell expects to hit its 6% profitability target a year early, it said on Thursday after posting better than forecast quarterly and annual profit on the back of cost savings and a rise in mortgage lending. Lower impairments for last year as it recovered from the COVID-19 pandemic helped the bank to a 530 million euro ($598 million) net profit for 2021, above the 2 million euros in 2020 and the 403 million euros expected by analysts polled by Reuters. This allowed Sabadell to close the year with a 5% return on tangible equity (ROTE), up from 0.02% in 2020.
Spain's Sabadell said on Saturday its board has rejected an offer from Co-operative Bank for its British subsidiary TSB, after Sky News first reported about the approach. Sabadell confirmed in a statement that it had received a letter from Co-operative Bank outlining a proposed offer for TSB, but said its board had officially responded to Co-operative Bank that "this is not a transaction that we wish to explore at this moment as we have previously expressed publicly". Sky News said Co-operative Bank had indicated to Sabadell that it would be willing to pay more than 1 billion pounds ($1.38 billion) to acquire control of TSB.