This Reuters article reports this morning that Madrid-based Banco Bilbao Vizcaya Argentaria SA (“BBVA”) is considering an acquisition of McAllen, Texas-based Texas Regional Bancshares Inc., a holding company with with a market capitalization of $1.87 billion that is in the retail banking business under the name of Texas State Bank.
BBVA is Spain’s second-largest bank that has traditionally focused on the remittance market in the U.S. where it facilitates the transfer of funds by immigrants to their home countries. Lately, BBVA has been expanding its U.S.-Mexican business operations — its Bancomer unit is already Mexico’s largest bank and it recently purchased Laredo National Bancshares for $850 million, so the possible acquisition of Texas State Bank’s owner would constitute a further expansion of BBVA’s U.S. business operations. BBVA is a big outfit, with a market cap of over $66 billion, net income of over $3.8 billion last year and over 90,000 people employees worldwide.
Texas Regional Bancshares is a regional bank located in Texas’ Rio Grande Valley (wonderfully depicted in the movies Lonesome Dove and Lone Star) that has about 75 branches and $6.5 billion in assets based primarily in south Texas. In 2002, Texas Regional commenced an expansion plan in which it has bought small banks in the Houston, Corpus Christi and Dallas areas, which likely makes the bank even more attractive to BBVA. With the large immigrant populations in both Houston and Corpus, BBVA could use the Texas State Banks as the foundation of a substantial increase in its remittance business in Texas while also expanding its traditional banking operations in the state.