Privatization has been the fate of all but a few of Europe's unquoted financial institutions. Demutualization is all the rage. Non-shareholder banking models are few and far between, but Spain is a notable exception. Here, the private savings banks are growing and consolidating and show no signs of letting go of their special legal status. The Spanish savings bank model has virtually no critics. It has proved itself a successful structure because of a number of features. Most notably, since the creation of these unique financial institutions over a century ago, there has not been a single default.
The savings banks - cajas - have managed to adapt to a changing economic and banking environment and, concentrating on their retail banking business, have strengthened their regional positions and continued to grow market share in deposit and credit business nationwide.
Despite a slowdown in economic growth throughout the eurozone in 2001, the savings banks have reported increased profits for the first quarter. The largest of them, Caja de Ahorros y Pensiones de Barcelona (La Caixa), reported post-tax profits up about 15% to Pts37.4 billion ($190 million) on the previous year. The second largest, the Caja de Ahorros y Monte de Piedad de Madrid (Caja Madrid), reported a rise of 15.6%