Liberbank : Initiating coverage with a Positive opinion and ‘Buy’ recommendation on the expected credit benefits from a likely merger with Unicaja

We initiate the coverage on Liberbank ahead of the announcement (probably later this month) of the outcome of the discussions with Unicaja Banco (Baa3/BBB-) for a potential merger revealed in December. Unlike another M&A transaction currently being discussed in Germany, the benefits for most stakeholders seem clear to us and the merged entity would in our view display a stronger credit profile than Liberbank’s. If the merger talks were to fail, Liberbank’s improving metrics on a ...