EU competition authorities gave the formal green light on Tuesday for the sale of Spanish lender Banco Popular to Spain’s biggest bank Santander, the first major test of Europe’s new system for dealing with failing banks.
The European Commission, which oversees competition issues, said that investigators concluded ‘the transaction would not raise competition concerns’ in Europe’s economic area.
It said their combined market share would be limited and that strong competitors remain in all markets affected by the move.
Santander acquired Banco Popular in an overnight auction in June for €1 after the European Central Bank warned that Spain’s No. 6 bank by assets was on the verge of collapse – a deal showcasing Europe’s new system to rescue failing banks without burdening taxpayers or markets.
The Spanish government said that Popular would not have been able to remain open without the buyout, adding that it had both preserved people’s savings and avoided the expenditure of any public funds in keeping the bank afloat.