Spain's competition regulator, the Comisión Nacional de los Mercados y la Competencia (CNMC), has granted approval for BBVA's €11 billion hostile takeover of Banco Sabadell, according to Financial Times. This approval comes with specific conditions designed to sustain market competition, focusing particularly on rural areas as well as the regions of Catalonia and the Valencian Community.

BBVA has made several commitments to address these competition concerns. El País reported that the bank will maintain credit conditions for small and medium-sized enterprises (SMEs) and will ensure physical access to its branches in locations where banking services are currently scarce. Additionally, BBVA will uphold existing terms for ATMs and payment methods over the next three years, as part of the conditions set by the CNMC.

The Spanish government now has a 15-day window to potentially impose further scrutiny on the merger. While the government cannot outright block the takeover, additional conditions could be placed that might hinder the deal's progress, El País noted. Banco Sabadell, on the other hand, has expressed concerns over the CNMC's approach, arguing that the merger may adversely affect SMEs and lead to branch closures in key regions. If successfully completed, this merger would position BBVA as Spain's second-largest lender by loan volume.