Competing against large private banks: the successful strategy of the la Caja de Ahorros de Madrid during Franco’s dictatorship (1962-1975)

Abstract

Since their creation in the mid-19th century, savings banks have played a crucial role in the Spanish economy, not only at the national level but also regionally and locally. These centuries-old institutions have deep roots in the municipalities and provinces where they offered their services. From the beginning of the 20th century, they became significant competitors to private banks. Recognizing that the working classes, traditional customers of the savings banks, would be key to their development in the medium term, private banks established their own savings sections. In this context, the Caja de Ahorros y Monte de Piedad de Madrid, during Franco's regime—a period financially dominated by private banks—managed to capture a large portion of the savings resources in the province of Madrid and positioned itself alongside the major national banks of the era. What strategy did it employ during a period characterized by significant legislative changes aimed at increasing competition in the sector? How did a savings bank manage to compete on an equal footing with the powerful national banks of Franco's regime? These are the main questions this article aims to answer.