Catalonia, among the regions with the fewest bank branches per inhabitant

BarcelonaMore population, lower density of bank branches. Catalonia, along with Andalusia and Madrid, the most populated autonomous communities, has the fewest bank branches per 100,000 inhabitants, according to data from the Bank of Spain. And regions like Extremadura, La Rioja, and Aragon, with smaller or more dispersed populations, are among those with the most. However, in both cases, the reduction in networks and supply, with the disappearance of savings banks through their transformation or absorption by other entities, has been drastic since the peak reached in 2008, the year the financial crisis erupted.

Evolution of the number of bank branches

The result is that, although smaller communities maintain a higher density of branches than more populated ones, the networks are concentrated in a few cities, and the rest of the country suffers from a veritable desertification. For this reason, initiatives have been launched that, in some cases, mitigate the lack of physical branches with mobile banking services. Jordi Fabregat, a professor at Esade, states that a significant reduction in branches was "logical" because Spain's situation was "an exceptional case" in Europe. In 2008, the network of bank branches exceeded 45,000 throughout Spain, with a ratio of 99.02 per 100,000 inhabitants, while last year, with approximately 17,000 branches, it fell to 35.03, a drop of 65%. And during this period, the population has grown by about 2.8 million, more than 6%.

During this period, Catalonia has gone from having more than 8,000 physical branches and a ratio of 110.64 per 100,000 inhabitants to 25.66, with a total of 2,085 branches—an even greater decrease of over 76%. The population has increased by almost 800,000, a 10% rise. The disappearance of the 10 savings banks that existed in Catalonia has played a significant role, compounded by the cutbacks implemented by the banks. We have gone from a time when bank branches were located side by side to having to walk much further to find one and having to take a number, like when going to the doctor. If we divide the number of branches by the total population, the ratio has gone from one per 1,009 inhabitants in 2008 to 2,854 at the national level. And in Catalonia, the change has been even more pronounced, going from one office per 904 inhabitants to one per 3,896. In Madrid, for example, the change has been from one office per 1,045 inhabitants to one per 3,887, and in Andalusia, from one per 1,171 to 2,898. Meanwhile, in Extremadura, the ratio has increased from 918 inhabitants per office to 1,570; in La Rioja, from 641 to 1,626; and in Aragon, from 740 to 1,652.

Coverage and excluded population

According to experts, one of the main challenges today, given the rise of digitalization, is "how to cover underserved areas," says Fabregat. In fact, the Catalan government awarded a contract for mobile banking services. in CaixaBank and Caixa Ingenieros for 503 towns totaling 308,000 people that do not have physical branches. And the Barcelona Provincial Council awarded Prosegur a similar service for 96 towns in the province, totaling 58,000 inhabitants. Similar initiatives have been taken in other autonomous communities. The Ministry of Economy places the percentage of the population with at least one point of access to financial services at just over 99%, thanks to commitments from the banking associations (AEB), savings banks (CECA), and credit unions (Unacc), meaning that less than 1% still lacks access.

A Funcas study on the sector, conducted by Santiago Carbó, Pedro Jesús Cuadros, and Francisco Rodríguez, confirms that despite the reduction in the physical banking network, with almost 35 branches per 100,000 inhabitants, compared to almost 100 on average in 2008, Spain continues to maintain a significant presence. The authors highlight a change "in the configuration of bank branches – more employees per office and a larger population to serve." Furthermore, fewer branches now manage a higher volume of transactions through offices that, in many cases, offer areas for meetings, coffee, and other services. Another factor driving this drastic reduction in physical branches is the need for institutions to reduce operating costs. At the same time, market concentration has skyrocketed. The Funcas report states that in 37 of the 52 provinces and autonomous cities, banking concentration increased between 2019 and 2023. As a result of this process, the market in Catalonia is highly concentrated in four institutions, controlling around 85% of the branches, according to the report by the Catalan Government's Authority on BBVA's takeover bid for Banc Sabadell, which ultimately failed.

The first is CaixaBank, with 38.9% of the total in Catalonia and coverage almost throughout the region, especially after the commitments made to the National Markets and Competition Commission (CNMC) to absorb Bankia in 2021. This entity split into the bank, CaixaBank (2011), and Laietana, which came from Bankia, as did Caixa Penedès. The second is BBVA, which at one time acquired the three Unnim savings banks –Manlleu, Sabadell, and Terrassa– and those of CatalunyaCaixa –Catalonia, Manresa, and Tarragona–, with 18.7%. The third is Sabadell, which integrated Caixa Penedès's branch network in Catalonia, with 16.1%; and the fourth, Santander, with 12%. Other integrations during this period included the absorption of CAM, Banco Gallego, and the Lloys TSB network in Spain by Banc Sabadell; Barclays by CaixaBank; Popular by Santander; and Liberbank by Unicaja Banco. The only institution that added branches during this period was Caixa Ingenieros, a credit cooperative. Fabregat states that it is unlikely the number of branches will increase in populated areas and that solutions will have to be expanded to serve areas without branches and the population most at risk of exclusion. All of this must be combined with the digitalization driving the transformation of the sector and the use of artificial intelligence (AI) to personalize services, as well as to attract younger customers, who tend to choose neobanks (fully digital entities), according to consultancies such as Capgemini.