Banking concentration increases across Europe due to crises, mergers, and digitalization, leading to fewer, larger institutions.
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The banking sector across Europe is experiencing significant concentration, driven by mergers, acquisitions, and digitalization following the 2008 financial crisis. In Spain, exemplified by Sofía’s experience, bank employees face job insecurity amid increasing commercial targets and digital transformation. A potential hostile takeover of Banco Sabadell by BBVA could further intensify banking concentration in Spain. Globally, this trend has led to fewer, larger entities; for instance, only ten significant banks are supervised by the European Central Bank (ECB) in Spain. Economists note that while Spanish concentration is moderate, it exceeds major European standards. In Greece, the crisis resulted in an oligopolistic market structure with a few dominant banks. Other regions show similar trends: Hungary sees state intervention and foreign bank discouragement, Bulgaria exhibits oligopolistic signs across sectors, and Czech banking is dominated by three large international banks. The ECB confirms that job reductions are widespread due to failures, cost-cutting, and reduced international presence, leading remaining staff to serve more customers while facing challenges from increased reliance on ATMs and electronic banking.
