Caixabank absorbs Bankia: the birth of Spain’s largest lender, in figures

The acquisition of state-owned lender Bankia by Caixabank, greenlighted by both companies on Thursday night, will produce the largest financial institution in Spain with around 600 billion euros in assets.

Since merger talks were announced two weeks ago, the biggest question mark became what weight each company would hold in the resulting organization. 

According to the final deal, Caixabank offered 0.6845 shares for every share in Bankia — which means that the former will hold 74.2% of the new company, while the latter will keep 25.8% of the conglomerate’s shares.

With a large part of Bankia’s assets controlled by Spain’s bank bailout fund FROB, 16.1% of the new company will remain state-owned.

The largest shareholder will be Fundació Bancària La Caixa, Catalan in origin, with 30% of the merged institution.

Since news of the merger broke, Bankia has seen its shares rise around 39.1%, while Caixabank’s increased by 13.7%. The combined market capitalisation now stands at 16 billion euros, according to a Caixabank press release.

The banks said they expect cost synergies of around 770 million euros. Once the integration is finalized, new revenues will be of around 290 million.

Restructuring costs stand at 2.5 billion, including provisions for eventual layoff.  

The resulting institution will keep Caixabank’s name and its legal headquarters in Valencia, where the institution relocated from Barcelona in 2017 following political tension and economic uncertainty in the wake of the Catalan independence bid. However, the central headquarters will be divided between Barcelona and Madrid. 

Caixabank’s CEO Gonzalo Gortazar will also become the chief executive of the new corporation, with Bankia’s José Ignacio Goirigolzarri serving as executive chairman.

The board of directors will have 15 members, a third of them women, and nine of whom being presented as "independent" from both institutions.

21.6 million clients and 50,000 employees combined

With 13.6 million Caixabank clients and another 8 million Bankia ones, the new bank is set to have a total of 21.6 million clients.

Both companies employ over 50,000 people (35,000 at Caixabank and 15,000 at Bankia), but a recent Barclays report suggests that around 5,750 workers could be left jobless.

With 6,727 offices combined across Spain, the new institution would far surpass Santander's 3,222 and BBVA's 2,592. According to Barclays, 1,411 Caixabank and Bankia offices could possibly share the same ZIP code and eventually be shut.