MADRID, May 1 (Reuters) - Spain's BBVA on Wednesday said it had submitted an indicative proposal of a merger transaction with Sabadell, creating a lender with over 1 trillion euros in total assets.

The bank offers an exchange ratio of 1 newly issued BBVA share for every 4.83 Sabadell shares, a premium of 30% over closing prices on April 29.

BBVA said that terms in the proposal had been approved by its board, adding that the bank was in a position to "move forward immediately with the transaction."

The potential merger follows a period of consolidation in the sector as Spanish banks seek to cut costs and boost scale. Spain now has 10 banks, down from 55 before the start of the 2008 global financial crisis.

On Tuesday

, BBVA said it had appointed advisers and told the chair of Sabadell's board of directors of its interest in initiating negotiations over a potential merger.

(Reporting by Jesús Aguado; editing by Tommy Wilkes)