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BBVA accepts Scotiabank's offer for BBVA Chile stake

Banco Bilbao Vizcaya Argentaria SA has accepted Bank of Nova Scotia's offer to acquire the Spanish lender's 68.19% ownership in Banco Bilbao Vizcaya Argentaria Chile SA, as well as its interests in certain subsidiaries, for approximately US$2.2 billion.

Toronto-based Scotiabank plans to merge BBVA Chile with its existing operations in Chile, Scotiabank Chile, subject to regulatory approvals. The transaction will double Scotiabank's market share in Chile to approximately 14%.

The Said family, which holds a 31.62% stake in BBVA Chile, waived its right of first refusal to purchase BBVA's shares of BBVA Chile. The family, however, maintains the right to tender all or a portion of its shares in the mandatory tender offer to be carried out by Scotiabank.

Should the Said family invest up to around US$500 million to own up to 25% of the combined business when Scotiabank Chile and BBVA Chile are merged, Scotiabank's common equity Tier 1 capital ratio would be impacted by around 90 basis points. On the other hand, should the transaction complete and the Said family tender all of its shares in BBVA Chile to Scotiabank, Scotiabank's CET1 capital ratio would be impacted by around 135 basis points.

Scotiabank has more than C$915.27 billion in assets as of Oct. 31; BBVA Chile had assets of 14.06 billion Chilean pesos as of Sept. 30.

As of Dec. 4, US$1 was equivalent to 647.70 Chilean pesos.