Spain's central bank calls on BBVA to look closely at spying accusations

MADRID (Reuters) - Spanish bank BBVA must look closely at accusations against its former chairman Francisco Gonzalez to avoid potential costs to its reputation, Bank of Spain Governor Pablo Hernandez de Cos said on Monday.

Spanish authorities are investigating contracts with a jailed ex-police chief Jose Manuel Villarejo, whom news reports said was hired by BBVA in 2004 to spy on top executives of a potential buyer, construction company Sacyr.

"Our message remains the same; it's important that lender looks at this matter deeply and quickly in order to mitigate potential costs to its reputation," de Cos said during a conference in Santander.

In March, Gonzalez said he would temporarily step down as honorary chairman to avoid any harm to the bank's reputation during the inquiry.

Current chairman Carlos Torres told the same conference that the bank was cooperating closely with the judicial inquiry as well as conducting their own investigation into the matter.

The bank has acknowledged that it hired Grupo Cenyt, a security firm owned by ex-police chief Villarejo, who was arrested in 2017 as part of a separate investigation and remains in prison.

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

(Reporting by Jesus Aguado; Writing by Paul Day; Editing by Ingrid Melander)