CAIXABANK TO BUY BARCLAYS RETAIL BANKING IN SPAIN

Caixabank agrees to buy Barclays retail banking division in Spain. Reuters

Deal Is Part of a Global Retrenchment by Barclays As It Seeks to Shed Less-Profitable Units

MADRID— Caixabank SA CABK.MC +1.00% has agreed to buy BarclaysBARC.LN -0.78% PLC's retail banking division in Spain as the British bank scales back its presence in less-profitable markets.

Caixabank, Spain's third-largest bank by market capitalization, said Sunday evening in a statement that it would pay around €800 million ($1.05 billion) for Barclays retail banking business in Spain. The final price will depend on Barclays Spain's total assets at the end of the year, Caixabank said. Barclays said in a release Sunday that its Spanish units had €22.2 billion in assets and €20.5 billion in liabilities as of June 30.

The sale, which also includes Barclays's wealth and investment management and corporate-banking divisions in Spain, is expected to close at the end of this year and is subject to regulatory approval. Caixabank's purchase doesn't include Barclays's investment-banking division in Spain.

With the sale, Caixabank acquires around 550,000 new retail and private banking clients, 270 bank branches and 2,400 employees.

Caixabank already has the most bank branches of any Spanish bank, so the lender is likely to close some of the bank branches it acquires.

At its peak, Barclays had 5,100 employees and 600 offices. Now the bank has 2,800 employees and 271 offices.

The sale is part of a global retrenchment by Barclays as it seeks to shed less-profitable units in its vast banking business.

Barclays and other foreign lenders have struggled to gain traction in Spain, which is dominated by retail banking giants Banco Santander SA, SAN.MC -0.25% Banco Bilbao Vizcaya Argentaria SA BBVA.MC +0.34% and Caixabank.

Lloyds Banking Group LLOY.LN -1.36% PLC sold its retail banking business to Banco de Sabadell SA SAB.MC +0.38% in 2013. Banco Popular Español SA POP.MC +1.40%bought Citigroup Inc. C +0.21% 's retail banking and credit-card business this summer. Sabadell and Popular are Spain's fifth- and fourth-largest nonstate-owned banks by market value, respectively.

Many of the foreign banks have decided to concentrate more on their businesses at home or in their top-earning markets to help bolster their capital ratios after the financial crisis, analysts have said.

Caixabank has expressed interest in Barclays for months. Former Chief Executive Juan María Nin told The Wall Street Journal in an interview in June that the lender had "a lot of interest" in Barclays.