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

Big Catalan Bank to Relocate From Region Amid Separatist Drive -- Update

Big Catalan Bank to Relocate From Region Amid Separatist Drive -- Update

10/06/2017

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

Banco de Sabadell SA, one of Catalonia's biggest banks, said on Thursday that it would move its headquarters out of the restive Spanish region, as bankers said another major Catalan lender, CaixaBank SA, also was considering a relocation.

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

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

Instead, 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, some of these people said.

In a regulatory filing Thursday, Banco Sabadell said it "has adopted this decision in order to protect the interests of our customers, shareholders and employees." The move won't entail the transfer of any employees, it said.

Bankers and investors said CaixaBank also could 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 rose sharply on Thursday after plummeting this week after Catalonia's local government staged an independence referendum on Sunday, defying courts and the Spanish government, which 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 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 seek to remain protected by the Spanish government's deposit guarantee fund.

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