The Mexican division is launching its first debt issuance to fund the business. Its strategy in the country is to boost fee-based income and strengthen corporate banking operations.
Sabadell Mexico is charting a course toward financial independence. The Spanish bank’s Mexican subsidiary is finalizing its first independent debt issuance. The issue will be denominated in local currency to diversify funding sources, with major domestic institutional investors acting as buyers.
The subsidiary aims to raise up to 4 billion Mexican pesos (approximately 200 million euros), according to rating agency S&P, which has assigned a high investment-grade rating to the bonds.
The rating is based on the Mexican local scale and stands at mxAA+, second only to the top-tier “triple-A” rating. “The issuer will allocate 100% of the net proceeds to fostering the growth of its banking operations,” S&P explains.
Strengthening the loan portfolio
“The funds will be directed toward strengthening the peso-denominated loan portfolio, focusing on the economic sectors that predominate within the issuer’s existing portfolio. They will also facilitate the expansion of its sustainable loan portfolio,” the agency adds.
Becoming an issuer marks a step toward financial emancipation for Sabadell Mexico and provides a way to secure peso-denominated funds to complement the subsidiary’s financing, a significant portion of which is linked to the US dollar.
The timing is no coincidence. Holding reserves in pesos eliminates exchange-rate risk—particularly in a climate of high currency volatility driven by White House policies, which are influencing the movements of currencies closely tied to the dollar, such as the Mexican peso, financial sources explain.
All these factors have heightened investor appetite for participating in this debut issuance, the same sources add. Mexico boasts a robust investment fund and private banking sector, so demand for these new, highly rated bonds is expected to be strong. Clear Goals
Above all, Sabadell has a very clear strategy for Mexico—the only international market where it operates a fully licensed bank following the sale of its British subsidiary, TSB, to Santander. Its workforce in the North American country exceeds 500 employees, and it operates 12 offices.
The funds will not be used to fuel a drive for high-yield commercial offers aimed at attracting retail deposits and competing with BBVA, Santander, or Nubank for individual customers; instead, the focus will be on targeting businesses and large corporations, with the tourism, construction, and renewable energy sectors serving as key areas of emphasis.
The directive is to “increase revenue generation without consuming capital by boosting fee income, expanding the loan portfolio—leveraging products such as derivatives, foreign exchange trading, and fiduciary services—and developing new treasury strategies to achieve better returns on investments and repurchase agreement operations,” the bank states.
Strengthening Operations
The bank has prepared accordingly. Last year, Sabadell Mexico strengthened its local capabilities to improve services for larger companies and expanded its range of financial instruments.
The aim is to “offer more comprehensive service in structured finance transactions, thereby strengthening client relationships,” the bank affirms.
The goal is profitability combined with low capital consumption. Consequently, businesses are at the heart of the strategy; the retail offering is designed to be attractive enough to capture deposits and customers without negatively impacting the division’s financial results.
This policy has enabled Sabadell to improve its performance in the country. Net profit reached €64 million last year—a 13% increase, or 22.9% when adjusted for constant exchange rates.
Fee income was the primary driver of this growth, reaching €27 million after rising 46% in 2025.
Source: msn
