The acquisition will go ahead once Caja 3's restructuring plans are approved, the banks said.

Ibercaja needs to beef up its capital by 226 million euros ($293 million) to weather a serious downturn of the economy, according to an independent audit released in September, while Caja 3 had needs of 779 million euros.

An early plan to merge three entities - Ibercaja, Liberbank and Caja 3 - was called off after the audit revealed the potential group had a combined deficit gap of 2.1 billion euros.