May 11, 2021

BBVA seeks to seduce its shareholders with a dividend blow




If the bank had something valuable in recent years, it was its dividend. The price of their titles is no longer what it was, and the Covid-19 has not helped at all. When the European Central Bank (ECB) completely vetoed shareholder remuneration in 2020, the attractiveness of the sector plummeted. For this reason, now with the stock market value still on the ground, they seek at this moment to seduce the market with their great weapon: the dividend.

BBVA is especially playing with this asset thanks to the sale of its subsidiary in the United States, which
generate 8,500 million capital
. He has done it today in his general meeting of shareholders, in which he has emphasized his position. «Today we propose for approval by the board the necessary agreements to be able to implement a share buyback plan of up to 10% of the shares of the group that would be carried out once the sale of our subsidiary in the United States is closed, and after obtaining, where appropriate, the corresponding regulatory authorizations, and also subject to the share price and market conditions “, Carlos Torres, the president of the entity, has pointed out, while adding: «Regarding the 2020 dividend, we propose to this meeting the payment of 5.9 euro cents gross per share, the maximum amount allowed by the supervisor, which is It will be paid at the end of April ».

The bank has also tried to seduce its shareholders with what they plan to distribute over the year 2021. “Our intention is to resume the 35-40% dividend policy of the cash benefit, once the restrictions imposed by the European Central Bank are lifted. In short, achieving “a stable and predictable dividend policy is part of our ‘equity story’.” “If we combine the dividends paid with the performance of our shares, BBVA has been the sector entity in Spain with the best return for the shareholder in the last two years, from the beginning of 2019 until today, “he added.

To achieve their dividend objectives, they rely on that excess capital generated by the sale of the North American subsidiary. “It puts us in a position of exceptional strength and gives us enormous strategic optionality.” That capital allows them, Torres also assures, to increase shareholder remuneration, including forms of extraordinary remuneration.

Job adjustment

At the general meeting, the two main executives did not refer in their opening speech to the job adjustment which they hope to carry out in the coming months and whose negotiations have already started with the unions. According to the newspaper Expansión, the ERE would affect 3,000 people.

In this context, Onur Genç, CEO of the bank, has
tried to wink at the squad, acknowledging their effort
and work … despite the fact that the intention is to lose weight by several thousand the workforce. “We have talked a lot about digitization, efficiency and other initiatives, but, without a doubt, all our successes are thanks to the people who are part of BBVA. All of them are the key to our achievements. As I always say, our business is a business of people, of people serving people and, therefore, our bank is only as good as the people who make it up ”, he commented.

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