The healthiest banks are not ready to absorb other banks until they receive state-funded aid. So they only want to merge with banks that have already been nationalized, which are benefiting from share protection plans.
This seems logical, particularly when the banks will have to take losses, the amounts of which are still unknown and could lead to another collapse.
The reluctance to go through with mergers shows that the financial reforms are not going to work without state-funded aid. The two-year incentives are not enough. So the massive consolidation process might not occur as the Spanish government intended. If consolidation is stymied, then the financial reform will be left half-complete and will not contribute to clearing up doubts about the health of Spain's financial system.