The Spanish minister of economy, Carlos Cuerpo, rejects BBVA's hostile takeover bid for Sabadell due to "the increase in the level of concentration, which could have a negative impact on employment and the provision of financial services." His Catalan counterpart, Natàlia Mas, has also focused on the few banks that are still strong in Catalonia. But it's not just that there are few of them left, it's that BBVA has eaten almost of them.
The number two Spanish bank, chaired by Carlos Torres, has explained that, despite the statements made by governments, political parties, unions and employers in opposition to the hostile bid, it hopes that “the benefits of the operation will be appreciated.” The company hopes to complete the purchase process by mid-2025, when it hopes to obtain the necessary permits from all regulatory and competition bodies. The outlook then in the banking sector will be much tighter.
If the operation ends up being completed successfully, BBVA will have absorbed 8 of the 11 entities that made up the Catalan banking map prior to the 2008 financial crisis. At that time, Catalonia had 10 savings banks and one trading bank, as well as other savings banks linked to professional sectors, such as architects or engineers. There were also credit cooperatives, although their role was not widely recognized within the banking sector.
Sixteen years later, the only savings bank left in Catalonia is that of the engineers, Caixa d'Enginyers, which, if BBVA absorbs Sabadell, will be the second largest financial institution only behind Caixabank, which, although it has its headquarters in València, maintains a good part of its operations in the black towers on Avinguda Diagonal in Barcelona. In addition to the crisis, the demands of the European Central Bank (ECB) and the growth plans of the large institutions that dominate finance have reconfigured the banking landscape.
Thus, if the takeover bid for Sabadell is consummated, this process will have led to the concentration of all of Catalan banking in just two hands. In addition, of the 11 entities that existed, eight will have ended up under the BBVA brand, whose decision centre is located in Madrid.
The disappearance of the savings banks
Along the way, La Caixa d'Estalvis i Pensions (La Caixa) has become Caixabank and the rest of the savings banks no longer exist: Caixa Catalunya, Caixa Tarragona, Caixa Girona, Caixa Manresa, Caixa Manlleu, Caixa Penedès, Caixa Laietana, Caixa Terrassa and Caixa Sabadell.
The financial crisis of 2008 stirred up a hornet's nest and gave the savings banks a double problem. On the one hand, the ECB was forcing their disappearance, while at the same time many of them faced serious problems in being able to cope with the rise in bad debts, due to overexposure to customer profiles that were not very solvent or sensitive to the recession, and due to their small volume. This was a burden that dragged them down.
In response, the Spanish state created the FROB (Fund for Orderly Bank Restructuring), allocating more than 120 billion euros to rescue the Spanish financial sector. By promoting mergers between savings banks, it managed to form CatalunyaCaixa, a union of Caixa Catalunya, Caixa Tarragona and Caixa Manresa, which was born in July 2010 with the FROB as the main shareholder.
Later, in July 2011, Unnim was born as a result of the merger of Caixa Sabadell, Caixa Terrassa and Caixa Manlleu, with the FROB leading the operation. However, the new entity lasted less than two years, since the state did not want to have that weighting in the capital and looked for a buyer for both institutions, which turned out to be the same one: BBVA.
BBVA, a bank of Basque origin, the result of Banco Bilbao's absorption of Banco de Vizcaya and Argentaria, completed the acquisition of Unnim in 2013. Just two years later, it acquired Catalunya Banc, which had changed its name after passing from savings to full trading bank status. In this way, BBVA was left with six of the ten Catalan savings banks for an attractive price: 1.1 billion euros for Catalunya Banc and 1 euro for Unnim, but with the injection of 953 million euros by the FROB.
Although it is true that it had to disburse billions of euros to restructure them, the sector covered its back and negotiated the Asset Protection Scheme (EPA), an instrument by which it passed an annual bill to the Spanish state for the losses caused by the real estate assets from the banks it had absorbed.
As for Caixa Penedès, it joined Banco Mare Nostrum (BMN), also under the control of the FROB, with savings banks such as those in Murcia, Granada and the Mallorcan Sa Nostra. But at the end of 2012, Sabadell took over the BMN business in Catalonia, so it ended up returning to Catalan hands. A few years later, the FROB merged Bankia and what was left of BMN.
If the takeover of Sabadell is completed, these would join the list of institutions that have ended up in the hands of BBVA, further closing the circle of financial power in the Spanish state and confirming the almost complete disappearance of the banking sector in Catalonia.