European banks set for windfall from imminent Visa Europe deal -sources

By Steve Slater

LONDON, Oct 16 (Reuters) - Europe's banks are in line toshare billions of euros from a buyout of Visa Europe by its U.S.sister company Visa Inc., which is expected to be sealedin the next two weeks, sources said.

Credit card company Visa is in talks to buy Visa Europe, andproceeds would then be shared by more than 3,000 banks andpayment firms who own the network.

Sources familiar with the matter said the deal was close tobeing agreed, with one saying it is earmarked for Oct. 23 orshortly after, once the boards formally approve a deal.

Sky News has previously reported Visa Inc.'s offer is worth$21 billion.

Britain's Barclays could get about $2 billion froma deal, as banks will be paid based on how much business theyaccount for on the Visa Europe network. The data are notpublicly available but Barclays accounts for about 10 percent ofthe business, industry sources estimated.

The sources also estimated British banks account for about40 percent of Visa Europe's card payments, so could be in lineto receive about $8 billion, or more than 5 billion pounds. Muchof the remaining activity is in France, Spain and Italy.

That could see major banks including Lloyds, RoyalBank of Scotland, HSBC, Santander andBNP Paribas in line for hundreds of millions of euroseach, sources said.

Visa Inc. wants to re-unite with the European arm to give itmore global scale to compete with arch-rival MasterCard.

It said in July it was in talks to unite with Visa Europeand wanted to conclude talks on a deal by the end of October.

Visa Europe declined to comment and Visa Inc. could notimmediately be reached. (Editing by Sinead Cruise)