Download PDF

1. Company Snapshot

1.a. Company Description

Banco de Sabadell, S.A. provides banking products and services to personal, business, and private customers in Spain and internationally.The company offers retail banking products, such as current and savings accounts, personal loans, cards, and mortgages.It also provides financial products and services to large and medium enterprises, SMEs, shops and self-employed workers, private individuals, and professionals; and consumer finance, asset management, and bancassurance services.


In addition, the company offers corporate banking services, including financing services, transactional banking services, and other complex custom solutions in finance, treasury, and import/export, among others.Further, it provides insurance and pension products.As of December 31, 2021, the company operated 1,593 branches.


Banco de Sabadell, S.A. was founded in 1881 and is based in Alicante, Spain.

Show Full description

1.b. Last Insights on SAB

Banco de Sabadell's recent performance was driven by improved profitability and solid asset quality, as reported in its Q3 2025 results. The bank's guidance and shareholder remuneration plans were also updated. A slight decline in net profit was reported in Q4 2025, but robust asset quality improvements and significant shareholder remuneration were highlighted. Additionally, BBVA's failed takeover bid and TSB's earnings in robust shape ahead of Santander takeover have impacted the bank. A $4.6 billion buyback plan was announced by BBVA.

1.c. Company Highlights

2. Sabadell Delivers Solid FY 2025 Results, Poised for Continued Growth

Sabadell's financial performance in 2025 was characterized by a net profit of EUR 1.8 billion, with EUR 1.46 billion excluding TSB. The bank's NII stood at EUR 3.6 billion, fully aligned with guidance, while fees and commissions increased by around 4% year-on-year, driven by strong volume growth in off-balance sheet funds. The EPS came in at 'None' relative to estimates of 0.09073.

Publication Date: Feb -09

📋 Highlights
  • Leadership Transition:: Cesar Gonzalez-Bueno resigns as CEO; Marc Armengol to succeed him in May 2026.
  • Volume Growth:: Performing loans up 5.4%, customer funds +6.4%, with mid-single-digit volume growth in 2025.
  • Shareholder Remuneration:: EUR 1.5 billion returned, including EUR 700 million dividends and EUR 800 million share buyback.
  • Capital Generation:: CET1 ratio at 13.65% (13.11% post-dividend), with 196 bps capital generation in 2025.
  • Strategic Guidance:: 2027 RoTE target of ~16% ex-TSB, NII of EUR 3.9 billion, and 14.5% RoTE on tangible equity.

Revenue Growth and Asset Quality

The bank's volumes grew at mid-single digits, with performing loans increasing by 5.4% and customer funds by 6.4%. Asset quality continued its positive trend, with total cost of risk declining by 16 basis points and NPA coverage ratio standing at 64%. The credit cost of risk was 37 basis points in 2025, better than the guided 40 basis points for the ex-TSB perimeter.

Guidance and Outlook

Sergio Palavecino expects NII to increase by more than 1% in 2026, with a clear acceleration throughout the year. He also expects fees to increase by mid-single digits in 2026, driven by asset management and insurance fees. The bank is reconfirming shareholder remuneration of EUR 2.5 billion across 2026 and 2027.

Valuation and Dividend Yield

With a Price-to-Tangible Book Value not directly available, we can look at the 'P/B Ratio' at 1.2, and the 'Dividend Yield (%)' at 7.74%. Analysts estimate next year's revenue growth at 1.1%. The bank's strong capacity to generate capital while continuing to grow enables attractive shareholder remuneration, making it an interesting investment opportunity.

Key Highlights and Future Prospects

The bank has regained commercial momentum since the tender offer and is pursuing growth while preserving asset quality. Sabadell expects a return on tangible equity ex-TSB of around 14.5% in 2027, with a tangible equity of roughly EUR 10 billion. The distribution yield was around 9% in 2025 and is expected to remain around that level in 2026 and 2027.

3. NewsRoom

Card image cap

3 European Dividend Stocks To Watch Yielding Up To 7.9%

Apr -15

Source:

Card image cap

QuSecure Banking Deployment Spotlighted in Proposed SEC Post-Quantum Financial Infrastructure Framework as Real-World Proof for Post-Quantum Migration

Mar -19

Source:

Card image cap

Banco de Sabadell SA (BNDSF) Q4 2025 Earnings Call Highlights: Strong Asset Quality and ...

Feb -11

Source:

Card image cap

A Look At Banco Sabadell (BME:SAB) Valuation After Recent Share Price Pullback

Feb -06

Source:

Card image cap

TSB’s earnings in robust shape ahead of Santander takeover

Feb -06

Source:

Card image cap

Is Banco de Sabadell (BME:SAB) Still Attractive After Its Near 10x Five‑Year Surge?

Feb -06

Source:

Card image cap

Banco De Sabadell Appoints TSB’s Marc Armengol as Next CEO

Feb -05

Source:

Card image cap

TSB announces boss leaving to head up Spanish owner Sabadell

Feb -05

Source:

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (3.47%)

6. Segments

Banking Business Spain

Expected Growth: 3.5%

Banco de Sabadell's 3.5% growth in Spain is driven by a strong domestic economy, increasing consumer confidence, and a growing demand for digital banking services. Additionally, the bank's strategic focus on cost reduction, investment in technology, and expansion into new markets have contributed to its growth. Furthermore, the bank's diversified revenue streams, including retail, corporate, and private banking, have also supported its growth momentum.

Banking Business United Kingdom

Expected Growth: 3.2%

The 3.2% growth of Banco de Sabadell's banking business in the UK is driven by a strong lending market, fueled by low interest rates and increasing consumer confidence. Additionally, the bank's digital transformation efforts and strategic partnerships have improved operational efficiency and expanded its customer base.

Banking Business Mexico

Expected Growth: 4.5%

Strong economic growth in Mexico, increasing demand for credit and financial services, strategic expansion into high-growth regions, and effective cost management. Additionally, Banco de Sabadell's digital transformation and investment in technology have improved operational efficiency, enhancing customer experience and driving business growth.

7. Detailed Products

Personal Banking

Banco de Sabadell offers a range of personal banking services, including current and savings accounts, credit cards, personal loans, and mortgages.

Business Banking

The bank provides business banking services, including business accounts, credit facilities, cash management, and trade finance solutions.

Private Banking

Banco de Sabadell offers private banking services, including wealth management, investment advice, and estate planning.

Corporate Banking

The bank provides corporate banking services, including cash management, trade finance, and risk management solutions.

Investment Banking

Banco de Sabadell offers investment banking services, including mergers and acquisitions, equity and debt capital markets, and restructuring advisory.

Asset Management

The bank provides asset management services, including mutual funds, pension plans, and discretionary portfolio management.

Insurance

Banco de Sabadell offers insurance products, including life insurance, non-life insurance, and pension plans.

8. Banco de Sabadell, S.A.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Banco de Sabadell, S.A. operates in a highly competitive market, but the threat of substitutes is medium due to the complexity of banking services and the high switching costs for customers.

Bargaining Power Of Customers

The bargaining power of customers is low due to the lack of concentration in the banking industry and the high level of competition, which reduces the negotiating power of individual customers.

Bargaining Power Of Suppliers

The bargaining power of suppliers is low due to the high level of competition in the market and the lack of concentration among suppliers, which reduces their negotiating power.

Threat Of New Entrants

The threat of new entrants is low due to the high barriers to entry in the banking industry, including regulatory requirements and the need for significant capital investment.

Intensity Of Rivalry

The intensity of rivalry is high due to the high level of competition in the banking industry, with many established players competing for market share.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 76.72%
Debt Cost 8.88%
Equity Weight 23.28%
Equity Cost 8.88%
WACC 8.88%
Leverage 329.53%

11. Quality Control: Banco de Sabadell, S.A. passed 3 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Mapfre

A-Score: 7.3/10

Value: 5.2

Growth: 6.4

Quality: 5.8

Yield: 7.5

Momentum: 10.0

Volatility: 8.7

1-Year Total Return ->

View Full Report
Stock-Card
Banco de Sabadell

A-Score: 7.0/10

Value: 6.4

Growth: 6.0

Quality: 6.6

Yield: 7.5

Momentum: 10.0

Volatility: 5.3

1-Year Total Return ->

View Full Report
Stock-Card
ABN AMRO Bank

A-Score: 6.7/10

Value: 5.0

Growth: 5.3

Quality: 4.6

Yield: 8.8

Momentum: 9.5

Volatility: 7.0

1-Year Total Return ->

View Full Report
Stock-Card
BAWAG

A-Score: 6.7/10

Value: 3.2

Growth: 7.2

Quality: 5.8

Yield: 8.8

Momentum: 9.0

Volatility: 6.3

1-Year Total Return ->

View Full Report
Stock-Card
VIG

A-Score: 6.4/10

Value: 5.2

Growth: 4.2

Quality: 5.0

Yield: 6.9

Momentum: 10.0

Volatility: 7.3

1-Year Total Return ->

View Full Report
Stock-Card
EFG

A-Score: 6.3/10

Value: 4.4

Growth: 3.3

Quality: 5.1

Yield: 7.5

Momentum: 9.5

Volatility: 8.0

1-Year Total Return ->

View Full Report

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

3.3$

Current Price

3.3$

Potential

-0.00%

Expected Cash-Flows