Bankia was a Spanish bank formed in December 2010 through the merger of seven regional savings banks (cajas). It became Spain's fourth-largest lender overnight, with over 4,000 branches and 25,000 employees.

Bankia

Bankia held a 52.6 percent controlling interest in the new company.

History

The seven cajas that merged to form Bankia had aggressively lent into Spain’s property bubble. Bankia was created through the consolidation of the operations of seven regional savings banks in Spain. The seven cajas were Caja Madrid, Bancaja, La Caja de Canarias, Caja de Ávila, Caixa Laietana, Caja Segovia and Caja Rioja. Caja Madrid was the oldest of the Spanish savings banks and held a 52.6 percent controlling interest in the new company.

The Fall

Bankia was nationalized in May 2012. After Spain’s property bubble burst, Bankia and other banks sought to balance their books by urging clients to convert their savings into preference shares. Deposit clients were typically pensioners, who collectively bought around €30 billion of such shares. By late 2012 its shares were almost worthless and it had been bailed out with €22bn of taxpayers’ money.

Merger with Caixabank

CaixaBank, Spain’s third largest bank by assets, confirmed its takeover of Bankia. CaixaBank paid a 20% premium to take over Bankia. CaixaBank completed the legal procedures for the merger with Bankia to become the leading bank in Spain. The merger deal was approved by a large majority at the Extraordinary General Shareholders' Meetings of both CaixaBank and Bankia in early December 2020. The deal involved the creation of the leading entity in the Spanish financial sector. The operation complied with the timetable established to complete the legal merger and maintain the objective of completing the operational integration of the two entities before the end of 2021. The merged entity holds assets of more than €650 billion. The merged entity is Spain’s largest lender by market share in both domestic loans and deposits.