Best bank: CaixaBank
Even its rivals in Spain admit to feeling the impact last year as CaixaBank moved on from integrating Bankia to concentrating more exclusively on developing its business organically. This is evident, for example, in the savings market, where its customer funds increased by 3.1% in 2023. In insurance, a vital part of the group’s activities, there was also healthy growth, with a 7% volume growth in general and life risk premiums.
There was further evidence to validate the premise of the merger with Bankia, which was that CaixaBank’s insurance and asset management expertise would help the firm realize synergies. The percentage of former Bankia clients with non-life insurance products, for example, rose to 14.8% in 2023, compared with 10.8% immediately after the merger’s legal completion in March. As the proportion among other CaixaBank clients is 20.2%, that still leaves room for growth.
Like all Spanish banks, CaixaBank is reaping the benefit of higher interest rates on lending margins. But in its case, this is coming from a bigger base, boosted by the merger with Bankia – something that was achieved with relative ease, perhaps because the two firms had a relatively clear cultural fit.
At the end of 2023, CaixaBank had a 23.5% share of lending to households and businesses in Spain, coupled with a 24.7% share of deposits, a 23.6% share of investment funds and a 36.5% share of savings insurance. Its net income grew by 53.9% to €4.8 billion in 2023. Return on tangible equity grew from 9.8% in 2022 to 15.6% in 2023, with the cost-to-income ratio falling from 50.3% to 40.9%. The non-performing loan ratio was stable at just 2.7%, while the cost of risk was just 0.28%.
In spring 2024, BBVA’s bid for Banco Sabadell raised the prospect of a new Spanish number two, leapfrogging Banco Santander in terms of market share of banking assets. Yet there was a sense in which BBVA’s return to the table – four years after Sabadell rejected an initial bid because of price and after Sabadell’s share price had risen much more than that of BBVA since 2020 – highlighted the good timing of CaixaBank’s deal, completed just before the interest rate cycle started to turn.
This doesn’t matter much to CaixaBank now. It will remain number one, with or without a BBVA-Sabadell merger.
“The integration of Bankia, which we finalized in 2022, has meant that in 2023 and 2024 we have been fully focused on running the business,” says chief executive Gonzalo Gortázar. “The bank has grown slightly faster than the market for decades and you have seen this again in 2023. During the integration, our growth was more moderate, in a context of low market growth. Now we are regaining our commercial strength.”
Best investment bank: Banco Santander CIB
Banco Santander Corporate and Investment Banking (CIB) has recently stepped up its growth in markets such as the US and continental Europe. But its leadership in its home market of Spain was especially evident last year.
Santander is by far the biggest Spanish banking group. Global scale, expertise and networks help, especially when it is combined with a global headquarters in Madrid and a large universal banking operation in Spain, where it has the second-biggest share of the domestic retail market after CaixaBank.
Some international investment bankers in Madrid try to dismiss Santander CIB by claiming its business is all about balance sheet. But, like other banks, Santander is focused on distributing risk and deploying risk-weighted assets judiciously, including in its home market.
Santander CIB’s head of Europe, Ignacio Domínguez-Adame, says the bank wins mandates mainly through its proximity to clients, its knowledge of their businesses and markets, and its ideas. “Our balance sheet offers us an advantage versus some banks, but it’s not the main advantage,” he says. “Our business is mainly related to relationships and content.”
In 2023, Santander remained top of Dealogic’s bookrunner rankings for debt capital markets and loans. Its work included a €5 billion 15-year in February 2023 and a debut sustainability-linked bond for toll-road company Abertis.
Although equity issuance was thin in 2023, Santander was joint global coordinator on a €150 million rights issue for Técnicas Reunidas, among other deals. And it was one of the bookrunners in the €3 billion IPO of luxury fashion and fragrance company Puig once the IPO market began to thaw in early 2024.
Most illustrative of its strategic dialogue with clients, however, is its position at the top of Dealogic’s 2023 M&A ranking for Spain, a ranking in which no other Spanish bank features in the top 10. The bank points to advice to Repsol on its €600 million Asterion purchase; advising Telefonica on deals in Latin America; and its advice to Sacyr on various private equity sales.
Best digital bank: CaixaBank
According to comments from Eva Fernández, innovation director at CaixaBank in May 2023, the firm’s innovation agenda that year covered applied AI, quantum computing, web3 and decentralized finance, the metaverse, edge computing, regulation technology, climate fintech, the digital euro, central bank digital currencies, digital ID, distributed-ledger technology and open finance.
That was quite a challenge, but not for the bank that has the largest userbase in digital service channels of all financial institutions in Spain, with 11.2 million customers. The bank dominates digital banking in the country. It has a 43.4% market share, according to figures reported by GfK DAM, the official provider of digital consumption data in Spain.
Caixa is the leader in both mobile and traditional website channels, with a 38% market share in mobile – through its CaixaBankNow app and imagin – and 34.3% for its website.
The bank increased its investment in technology and development by 20% to €1.26 billion in 2023 and launched new products such as FXWallet and integrated generative artificial intelligence into its internal and customer-related processes.
The bank opened its dedicated research and development hub in 2022, where state-of-the-art technology is used to run programmes including neuroscience devices to explore emotions and perceptions; biometric devices for physical reactions; and eye-tracking devices to improve customer experience and understand behaviour better.
In partnership with Microsoft and Accenture, Caixa’s AI initiative aims to enhance digital innovation, streamline new software development and improve risk analysis. The bank has also signed a multi-year partnership with Google Cloud to advance its cloud strategy and improve data analytics.
FXWallet allows users to open virtual accounts for international payments in more than 50 currency pairs. This contributed to year-on-year growth of over 150% in digital currency transactions.
Best bank for SMEs: Banco Santander
Banco Santander has a 25% share of the Spanish small and medium-sized enterprise banking market, supporting over 416,000 SMEs. Its customer base grew by 19,000 over 2023 and it allocated more than €70 billion to SME financing. All of its SME customers used digital services, with 96% of domestic and 70% of international transactions conducted digitally.
The bank boasts 39% market share in Instituto de Crédito Oficial (ICO) financing and provided €876 million under the government’s liquidity ICO scheme. It also facilitated over 26,000 extensions on operational maturities amounting to €2.6 billion under the ICO Covid facilities.
The bank supported Spanish SMEs’ green transition programmes by financing green investments, sustainable mobility and agricultural sector sustainability products. It offers specialized non-financial solutions like AENOR sustainability certification, carbon footprint calculation and offsetting services.
The Smart Fund and Fondo Tresmares SME financing platforms saw further growth in 2023. The Smart Fund reached €1.6 billion and signed over €1 billion in capital through 247 transactions. Fondo Tresmares, with €1 billion in assets, expanded internationally and is expected to double its revenues in 2024.
Best bank for ESG: CaixaBank
CaixaBank worked on loans across the sustainable spectrum last year, including water management, energy, social impact and micro businesses.
It mobilized €50.8 billion sustainable finance towards a goal of €64 billion between 2022 and 2024. This included working on 120 sustainable finance transactions worth $18.74 billion and issuing €12.68 billion in loans indexed to sustainability, supporting projects in various sectors like fashion, water management, real estate and energy.
The bank also granted €1.38 billion in microcredits and social impact loans in 2023, a 36% increase year on year. Social impact financing transactions were up 44% and the bank supported 118,756 microcredits for vulnerable families, a year-on-year increase of 45%.
Best bank for corporate responsibility: Bankinter
Bankinter focused on financial education and empowering Spanish youth and entrepreneurs in 2023. It allocated over €3.6 million to social initiatives, up 29% on 2022. Around 20% of the bank’s workforce was engaged in social initiatives, up 6% year on year and benefiting over 19,000 people. The bank conducted more than 140 volunteering actions across various areas, including social, financial, environmental, sport and financial education.
The bank targeted financial education in 2023 and trained over 12,000 people through various educational programmes and initiatives. Its financial education platforms launched in 2023 included Money Town, for students aged 12-18, and Game of Traders, an educational game for university students, which attracted 8,875 players from more than 80 Spanish universities in 2023.
The bank invested in 47 startups and supported 135 innovative companies’ transformation into large corporations via the Cre100do programme. Bankinter’s Akademia innovation programme has engaged over 2,000 students from 12 universities, with 143 students participating in 2023.
Best bank for diversity and inclusion: Banco Santander
Banco Santander increased the representation of women in leadership positions and hiring plans across the bank in 2023. It also expanded its diversity in the workplace programme.
Banco Santander increased the representation of women in senior leadership positions to 31.4% and maintained 40% female representation on the board. The Santander Women’s Network, with 1,291 members, played a crucial role in promoting visibility, awareness and mentoring.
The Enable Professionals Network, with 406 members, supported integration and inclusivity for employees with disabilities. The bank also expanded the Embrace Professionals Community to 1,103 members and increased the visibility of non-normative families in marketing campaigns. There was a 15% increase in employees disclosing their LGBTQ+ status.
Branches with higher diversity net-promoter scores (NPS) also saw better overall customer NPS scores.
Best bank for corporates: BBVA
BBVA had a successful 2023, working on the country’s largest syndicated deals for large Spanish corporates. The bank now has 18% market share in corporate lending and 25% of its business is dedicated to corporate lending and deposits.
In trade credit, BBVA has a 13.2% market share and a 19.8% market share in the issuance of guarantees. In 2023, the bank discounted €5.9 billion in volumes and managed over 13,000 live programmes involving 180,000 suppliers.
It worked on a €5.3 billion syndicated sustainable key performance indicator (KPI)-linked revolving credit facility for Iberdrola in December 2023 and a €5 billion term loan for Fondo de Garantía de Depósitos in July 2023. It was also involved in syndicated sustainable KPI-linked revolving credit facility for Aena, a €2 billion deal in June. In the project finance sector, BBVA was mandated lead arranger and hedge provider for Project Segovia, a €339 million greenfield solar energy project.
