Spanish Banks

Banco Santander has won the auction for Banco Espaol de Credito (Banesto)--four months after the Spanish government intervened to prevent Banesto's collapse. As Spain's most aggressive and most international bank, Santander was the logical buyer, but its stock fell because analysts and investors considered the $2.27 billion price for control of Banesto too high. They think it will take several years for Banco Santander to make Banesto's operations profitable. Santander may decide to spin off some of Banesto's international assets, possibly to some of its own affiliates.

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