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Home>Big Catalan Bank to Relocate From Region Amid Separatist Drive

Big Catalan Bank to Relocate From Region Amid Separatist Drive

Big Catalan Bank to Relocate From Region Amid Separatist Drive

10/05/2017

 By Max Colchester in London, Jon Sindreu and Jeannette Neumann in Barcelona 

Banco de Sabadell, one of Catalonia's biggest banks, said on Wednesday it will move its headquarters out of the restive Spanish region, as the area's second big lender, CaixaBank SA, considered a similar move.

The strategies underscore how the separatist drive is roiling Spain beyond politics and into the realm of business and economy. Sabadell said it would move its legal base to Alicante, Spain, following a decision by its board.

Surges of separatist sentiment in other nations have long pushed banks to either relocate or consider it. In Catalonia, any move could prove cosmetic in the end, with the legal headquarters leaving the region but staff and executives largely staying, analysts say.

Some of these people said the moves were likely a form of cheap legal insurance to protect banks against lawsuits if shareholders and clients lost money because of the region's secessionist drive.

Banco de Sabadell's board was meeting Thursday afternoon to approve moving their headquarters from Barcelona to another Spanish city, said an official with the bank.

Bankers and investors said CaixaBank could also shift its legal headquarters away from Barcelona to another part of Spain. In a statement, a CaixaBank spokesman said the bank "reiterates that the necessary decisions will be made, in a timely manner."

Shares in the two banks have plummeted this week -- including at least 5% on Thursday -- after Catalonia's local government staged an independence referendum on Sunday, defying courts and the Spanish government who declared it illegal. That stoked fears that local banks may suddenly find themselves outside the eurozone and cut off from European Central Bank's emergency liquidity facilities.

Analysts said that while an independent Catalonia could retain the euro as its currency, its lenders would likely need to go through other eurozone banks to tap ECB funding. If Catalan banks run into trouble they also wouldn't have a powerful central bank to help them out. Catalan banks also seek to remain protected by the Spanish government's deposit guarantee fund.

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