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MADRID, June 21 (Reuters) - Banco Sabadell is open to selling its British unit TSB at some point as buying it was a strategically bad decision, the Spanish bank’s Chief Executive Officer Cesar Gonzalez-Bueno said on Monday.
Sabadell’s acquisition of TSB in 2015 ran into issues in 2018 when IT glitches sent costs spiralling and led to the booking of accumulated losses of around 500 million euros ($596 million) over the last three years.
Sabadell had been planning to sell TSB, but its new CEO has frozen the process and is working on turning the bank around.
“If at some point, there is a (potential) buyer interested at a later stage, we are open to it. Right now we don’t even want to hear about it,” Gonzalez-Bueno said during an event held in Barcelona.
“We are not longer forced to sell,” he said.
Gonzalez Bueno said that even the previous CEO Jaime Guardiola and current bank Chairman Josep Oliu “openly acknowledged” that buying TSB was not a good decision from a strategic point of view.
“Although there was a very thorough analysis, some elements were missing that were not perfect, but apart from that, what has been absolutely critical since then has been the evolution of events, including Brexit and the deep crisis,” Gonzalez-Bueno said.
As part of the bank’s strategy released in May, Sabadell said it expected TSB, which in the first quarter swung back to profit, to reach a ROTE (return on tangible equity) of more than 6% by 2023, buoyed by growth in mortgages and continued cost reductions.
TSB booked a loss of 220 million euros in 2020.
$1 = 0.8391 euros Reporting by Jesús Aguado and Emma Pinedo; Editing by Inti Landauro and Barbara Lewis