Banco de Sabadell, S.A. (BNDSF)

UPDATE 3-BBVA, Sabadell to explore possible merger

Spanish lender BBVA and smaller rival Sabadell said on Tuesday that they had started negotiations to explore a possible merger, triggering a rise of more than 7% in Sabadell's shares. BBVA said it had conveyed to the chair of the board of directors of Banco Sabadell the interest of BBVA's board of directors "in initiating negotiations to explore a potential merger transaction between the two entities". Sabadell confirmed that it had received an indicative written proposal from BBVA for a merger on Tuesday afternoon.