Analyst sees Barclays buying caja

BARCLAYS is edging towards an acquisition of one of Spain’s struggling savings banks, according to Evolution Securities analyst Arturo de Frias.

Following chief executive Bob Diamond’s visit to Spain last week, in which he met with Spanish Prime Minister José Luis Rodríguez Zapatero, de Frias says that Barclays is likely to move in on one of the country’s troubled cajas in the coming months.

“It has been our view for some time that Barclays is likely to make a sizeable retail acquisition and raise simultaneously some more capital… what we call a ‘deal-cum-rights issue’,” de Frias wrote in a note to clients.

He added that a string of recent hires in Spain, including former Bankinter chief Jaime Echegoyen and former finance minister Pedro Solbes, make it likely that the bank is looking to expand beyond its current small retail network in the country.

If Barclays is looking to make a purchase, de Frias estimates that it will need to do a rights issue of £4-5bn, half of which will be used to top up capital ratio. He has a “sell” recommendation on Barclays as a result.

The Spanish caja space is undergoing broad restructuring as the government looks for ways to plug a capital hole that the Bank of Spain has estimated at €15bn (£13.3bn). But observers say it could be higher, meaning that the state could offer guarantees to buyers of stricken banks. Potential purchasers are likely to include several private equity houses as well as banks.

Barclays declined to comment.