UPDATE 1-Spain’s BBVA ‘rigorously’ investigating alleged spying case

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FILE PHOTO: The headquarters of the Spanish bank BBVA are seen in Madrid, Spain, June 12, 2018. REUTERS/Juan Medina/File Photo

MADRID (Reuters) – BBVA is “rigorously” investigating spying allegations involving the Spanish bank, its executive chairman Carlos Torres said before its annual shareholders meeting on Friday.

Torres also said his predecessor Francisco Gonzalez, who on Thursday stepped down as BBVA’s honorary chairman while awaiting the results of the inquiry, and the bank will cooperate with judicial authorities investigating the case.

“In relation to the case, BBVA will continue investigating rigorously, also actively collaborating with judicial authorities to clarify the facts,” Torres said.

The case is not officially on the agenda of the shareholders meeting in Bilbao, but the Spanish Association of Minority Shareholders (AEMEC) expect investors to voice their concerns over the potential reputational damage to the bank.

The inquiry relates to jailed ex-police chief, Jose Manuel Villarejo, who news reports say the bank hired to spy on top executives of a potential buyer, construction company Sacyr, in 2004 when Gonzalez was BBVA’s executive chairman.

BBVA has acknowledged that it hired Grupo Cenyt, a security firm owned by Villarejo who was arrested in 2017, as part of a separate investigation.

Torres, who replaced Gonzalez as executive chairman in January, has so far said that Cenyt provided various services to BBVA, but that the bank had found no evidence of spying.

The case was first reported in mid-2018 and was recognized by the bank in January after Torres sent a letter to staff addressing the allegations.

BBVA shares were up 1.3 percent at 1255 GMT, bringing their gains so far this year to 15 percent and outperforming other Spanish and European banks.

Reporting by Jesús Aguado; editing by Paul Day and Alexander Smith

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