CaixaBank and Bankia, a Spanish state-owned bank, said Friday that they had been given authorization through their forums to merge, creating the country’s largest national bank.
The agreement will create a bank with assets of more than $786 billion and CaixaBank will allocate 0. 6845 of its shares for a Bankia share.
The transaction is expected to close in the first quarter of 2021, and the merger is expected to be approved through shareholders of any of the banks, as well as regulatory and festival authorities.
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The new bank, which will operate with the CaixaBank brand, increases the group’s exposure to retail banking and will have more than 20 million customers.
“With this transaction, we will become the first Spanish bank at a time when it is more mandatory than ever to create entities of significant size, thus helping to help the wishes of families and companies, and the soundness of the monetary system,” he said. Bankia President José Ignacio Goirigolzarri.
Goirigolzarri will be the executive chairman of the combined bank, while Gonzalo Gort-zar, CEO of CaixaBank, will be the CEO of the new entity.
“The merger will allow us to face the demanding situations of the next 10 years with greater scale, monetary strength and profitability, which will result in greater price for our shareholders, more opportunities for our employees, greater service to our consumers and greater skill for Spain. Economic recovery,” Gortzar said.
Banks across Europe are grapping with a low interest rate environment and have an effect on COVID-19.
Bankia is compared to Lehman Brothers, the U. S. investment bank whose fall in the 2008 maturity triggered the currency crisis. Bankia was Spain’s largest lender until the eurozone debt crisis in 2012 pulverized the country’s banking sector, causing 22. 4 billion euros ($26. 6). billion) state bailout.
05h30. ET CaixaBank shares rose 0. 6% to EUR 2. 06 ($2. 5) and Bankia shares fell 2. 2% to EUR 1. 4 ($1. 7).