Spanish Banks Merge in Sign of Hard Economic Times Ahead

A child looks at a man sleeping outside a CaixaBank brach office in Barcelona, Spain, on July 17, 2020. Emilio Morenatti/ AP Photo

LISBON, Portugal—Two of Spain’s biggest banks said on Friday that they were merging, pushed together by a need to weather tough economic times that likely will cost thousands of jobs.

The tie-up between CaixaBank and Bankia will create the largest lender in the country, with assets of more than 664 billion euros ($787 billion).