Catalan savings banks' merger moves closer

A three-way merger between Spanish savings banks from the region of Catalonia moved one step closer after the potential partners approved plans for a joint tie-up.

"Today's board meeting...agreed to the proposal to develop the project to merge with the Terrassa and Manlleu savings banks," Caja de Ahorros de Sabadell said.

Spain's 46 savings banks have been left badly exposed to a soured domestic property market, and merger talks between them have mushroomed as bad loans quadrupled over the past year, heightening solvency risks.