Saturday, September 5, 2009

What's Up With Spanish Banks?

Banco Santander stock was up 4.92% in Friday's regular trading, even though it was down 1.67% in after-hours trading. The news on the company wasn't that good: one of the items in Reuter's Key Developments for the bank was the notice that Santander, Spain's largest bank with a presence in South, Central, and even North America, was increasing its capital so as to be able to pay a dividend. It's selling 15% of its Brazil division in an IPO, after expanding said division by 600 branches. These last two items can be seen as unambigously good, even if a positive spin can be put on the dividend-payment item.

The reason it went up so much doesn't seem company-specific, though. Bancolumbia was up 4.65%, with no backtrack in after-hours trading. The reason could be the banks with Latin American presence are coming into fashion.

If so, then there was an exception: Banco Bilbao Vizcaya Argentaria. This bank, Spain's second-largest, was up only 1.68% on Friday; it too has a presence in Latin America and even the U.S. The stocks of all three banks, however, have been climbing since about mid-July.

Disclosure: I'm holding Bilbao in the actively-managed Marketocracy mock fund I run.