UPDATE 1-Spain's BBVA sells Panama unit to Colombia's Grupo Aval
BOGOTA/MADRID, July 19 (Reuters) - BBVA, Spain's second-biggest bank, has agreed to sell its Panama unit to Colombia's largest banking conglomerate, Grupo Aval, in a deal worth $646 million.
In a filing to Spain's stock market regulator, BBVA said on Saturday it would receive $490 million in cash and $140 million paid through a dividend from its Panamanian arm before the sale.
It will receive a further $16 million as an adjustment for the earnings made by the unit between June 1 and Nov. 30 when the deal is expected to be closed.
The Spanish lender, which has been shedding its less profitable assets in Latin America in a bid to boost its capital and offset the weakness of its recession-hit home market, said it would book a net profit of 150 million euros ($197 million)for the sale.
In a separate regulatory filing, Aval said the 100 percent stake it would buy in BBVA Panama was subject to government approval, and would be made via its subsidiary Leasing Bogota S.A. Panama.
BBVA Panama has around $2 billion in assets, according to Grupo Aval's filing.
In late June, Grupo Aval bought Grupo Financiero Reformador in Guatemala for $411 million, a transaction carried out via its Central American subsidiary BAC Credomatic.