The explosion of Spanish banks and the dreams of converting Miami into the new Madrid have hit a road block. Spanish banks are by far the dominant influence on the Miami banking market, famed for being a Latin American banking center. Hidden in the local landscape, Spanish banks have gobbled up City National, Total Bank, and Mellon United among others. They are suffering indigestion as real estate credit issues and other unsuspected problems have forced them to put in more capital and slow down their growth. Coupled with similar problems back home, the Spanish banks hope for a revival of the empire gives us cause for reflection.
Growth of the Cajas (the Spanish equivalent to savings and loan banks) has been slowed and the Spanish government has sought to reduce their number, which account for about half of the banking system as one or another appear on almost every corner in Spain. From more than 40 Cajas, less than 15 will remain. Caja Madrid (one of the largest) is merging with Bancaja; Caja Galicia with Caixa Nova and CAM is also merging.
The forced consolidation will slow their plans in Miami as well. Spanish banks nevertheless will be a major contributory force in the Miami banking scene as they control 3 large local banks – Mellon United, Total and City National. It is only a question of time until Compass Bank owned by BBVA, present in north Florida, and Sovereign Bank owned by Santander are here as well. Like everything else in today’s economy, survival is success and growth will have to wait but it will come and with it Spain will lead the way in banking as well as soccer.(See the list of Spanish banks in Miami.)