More Gulf investment to target Spanish banks

17 March 2011

Sovereign funds expected to announce further Spanish investment

Several more large Gulf investments in Spanish savings banks are expected to be announced soon, following meetings between the Spanish Confederation of Savings Banks (CECA) and several regional sovereign wealth funds.

Already sovereign funds in Qatar and the UAE have announced plans to invest a total of €450m ($628m) in Spanish savings banks split between two deals.

Ceca is a association for the 34 Spanish savings banks that on 16 March concluded a four-day roadshow of the Gulf countries to attract investment in the banks it represents.

Jorge Jil, general manager of Ceca, says he is working towards securing further Gulf investment in several Spanish savings banks that plan to launch capital raising programmes before the end of the first half of the year. That is likely to include both additional investment from the existing Qatari and UAE sovereign funds, and investment from new funds.

“It is likely that before the summer we will back in this part of the world with specific opportunities to take to Gulf investors,” says Jil. He says that from the discussions he has already he is confident that more Gulf money will be directed to Spanish savings banks.

Spanish banks need up to €20bn according to some estimates, to fill a funding gap caused by lending too much into the Spanish property bubble.

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