MADRID, Oct 4 (Reuters) - A possible merger between Spain’s state-owned lenders Bankia and Banco Mare Nostrum (BMN) would involve “concentrating” both their operations to lower costs, Bankia’s CEO said on Tuesday.
Spain’s bank rescue fund said last week it would look into a merger of Bankia, Spain’s fourth largest lender, and the smaller BMN, which would potentially create a new entity with total assets of over 240 billion euros ($269 billion).
“A process of concentration is logical, above all to generate more value in an environment of low interest rates, and in this search for greater efficiency and cost synergies,” CEO Jose Sevilla told a banking conference in Madrid.
Other Spanish lenders such as Santander and Caixabank have said in recent months they would cut branches to lower costs as their profits are squeezed. Banco Popular said in September it would cut a fifth of its employees in a cost-saving plan. (Reporting by Angus Berwick and Amanda Calvo; Editing by Paul Day)