The combined influence of cyclical pressures, including suppressed income from negative official rates and a surge of digitalization across the economy and society, has led Spanish banks to a prolonged downturn in their network of offices over the past 14 years, a trend most pronounced in Europe. From the peak in September 2008 to the end of last year, credit institutions reduced their Spain branches by 58.5 percent, reaching 19,104 and marking the lowest level since September 1976. In other words, 27,014 stores were closed. It is as if every office opened in March 2018 disappeared.
All of this also caused an unprecedented drop in employment within the sector. Between 2008 and 2020, the Spanish banking sector shed 98,790 jobs, shrinking the workforce to 179,511 people, a decline of 35.4 percent and the lowest level since records began in 1981. The year 2021 saw a renewed acceleration due to mergers and the pandemic-caused economic crisis, with the Top 10 banks eliminating an additional 12,515 positions to reach 144,836. Yet, overall sector adjustment remains nearly 40 percent since 2008.
In Catalonia, the fall in bank offices since 2008 has been the most pronounced, at 71 percent, driven by the collapse of many Caixa institutions. Central regions followed closely, while the Valencian Community (64 percent), Madrid (62 percent), Murcia (60 percent) and Galicia (58.9 percent) also saw heavy cuts. In contrast, Navarre (42 percent), Extremadura (38 percent) and Castile-La Mancha (37 percent) experienced relatively smaller reductions due to slower branch growth in those years of the bubble. The impact also varied by municipality size, with major cities experiencing a larger drop (about 56 percent for populations above 50,000) compared with smaller towns (about 40 percent for populations under 5,000).
work in progress
The network contraction is far from finished. Ten large banks closed an additional 531 offices in the first quarter of 2022, increasing the total adjustment from 2008 to 59.7 percent, largely driven by CaixaBank and Unicaja after absorbing Bankia and Liberbank respectively. This consolidation came as revenues began to recover on the back of increased efficiency and rising interest rates. However, the mobile and digital banking surge continues to erode the need for physical branches, painting a future where fewer offices serve a growing customer base.
Spain still maintains a higher office-to-person ratio than many developed nations. Between 2008 and 2020, based on comparable data, Spain operated roughly 100 branches per 100,000 people, a figure that fell to about 45.5 per 100,000 but remains just over twice the EU average (22.6) and far above the United States (29.6). This disparity suggests there is room for further convergence to global norms; yet the population distribution means a smaller share of employees per branch is strikingly evident in the current landscape.
Financial exclusion remains a critical concern, especially in rural zones. Reports from EL PERIÓDICO, part of the Prensa Ibérica group, indicate that a precautionary package is under development by the Ministry of Economy and industry employers to address access gaps. The plan aims to ensure basic banking services and cash access for residents in rural municipalities where no bank branch exists, including the deployment of ATMs or mobile banking units. Some sources suggest a presentation before August as a step to mitigate these issues.
excluding 665,000
The share of people without access to essential financial services remains small but notable. End-2021 data from the National Institute of Statistics show about 665,000 Spaniards live in towns without a bank branch. That figure represents 3.3 percent of the population, or roughly 1.56 million people when considering broader indicators. Both figures are cited by EL PERIÓDICO and are expected to be released by banking associations AEB and CECA in the near future.
The provinces most affected include Burgos and Salamanca, each with hundreds of municipalities without branches in 2020, followed by Guadalajara, Avila, and Zamora. Other lists show municipalities in Valladolid, Segovia, Palencia, Cuenca, Zaragoza and Soria with substantial but smaller clusters without local branches. On the opposite end, Cordoba, Seville, Lugo, Murcia, the Balearic Islands, Cádiz, Pontevedra, Santa Cruz de Tenerife, Las Palmas, and Jaén reported fewer than ten municipalities lacking an office.