CaixaBank merges with Bankia to establish Spain’s largest bank

CaixaBank merges with Bankia to establish Spain's largest bank

The boards of Bankia and CaixaBank have agreed to the merger, which will lead to the Spanish banking sector giant.

Pierre-Philippe Marcou, Gabriel Bouys | AFP

Spain’s CaixaBank and the board of state-owned Bankia have approved a merger plan between the two lenders, which will make the largest bank in the United States with market share in retail operations.

According to the announcement released Friday, CaixaBank will be offering 0.6845 shares of Bankia State Restaurant under the terms of the deal. The newly-established lender, which will retain the CaixaBank brand, will have assets of more than 6668 billion euros ($786.8 billion), the company said.

The merger plan still needs to be approved at the shareholders’ meetings of both companies. And by competition authorities. The bank said it expects the process to be completed in the first quarter of 2021.

“Through this operation, we will be the best bank in Spain in a time when we need to create a corporation of a considerable size than ever before, helping to support the needs of families and businesses and strengthen the strength of the financial system. ,” Bankia Chairman Jose Jose Ignacio Goirigolzarri said in a statement.

Goirigolzarri will be the chairman of the new company, and Gonzalo Gortázar, now CaixaBank CEO, will be the CEO.

European lenders are under considerable pressure from the global financial crisis and the resulting very loose monetary policy. Additionally, the problem was exacerbated by the impact of the coronavirus pandemic earlier this year, and consolidation could be a solution to cut costs and increase business profitability.

READ  The airline market is ditching change expenses since it’s desperate for folks to fly

Banks said in a statement that “CaixaBank and Bankia’s strong equity capital positions will provide the ability to absorb restructuring costs and valuation adjustments, and the combined legal entity will achieve a CET1 rate of 11.6%.”

The closely observed CET1 ratio is a measure of capital strength introduced after the global financial crisis.

You May Also Like

About the Author: Max Grant

Devoted web lover. Food expert. Hardcore twitter maven. Thinker. Freelance organizer. Social media enthusiast. Creator. Beer buff.

Leave a Reply

Your email address will not be published. Required fields are marked *