Automotive News

Spain's Banco Bilbao Vizcaya Argentaria SA (BBV) and Chinese banking group China Citic Bank Corp Ltd. Tuesday signed an agreement to develop car loan and private banking businesses in China, BBVA said.

BBVA said it will hold a 35% stake in an auto lending joint venture business, which will include an initial investment of 500 million yuan, or EUR54 million.

Under terms of the second venture, BBVA will take a 20% stake in China Citic Bank's private banking business.

The partners aim to reach a 5% share of the Chinese market in each segment within a five year period, BBVA said.

Both segments are fast-growing. BBVA said China's car market is growing at an annual rate of more than 10%, with 2.67 million cars sold in the first quarter. Meanwhile, the number of wealthy individuals in the country is estimated to grow at an annual rate of 7% this year.

BBVA, Spain's second-largest bank by assets behind Banco Santander SA, owns a 10.07% stake in China Citic Bank.