The rise in interest rates has placed the profit of Spanish banks per client at the highest level in fifteen years, with the particularity that it is also the largest entities that take advantage of their economies of scale and stand out in this variable, ahead of the small ones.
According to the latest report with which Alvarez
This percentage is the difference between the yield on credit and the cost of deposits. If the first is around 4% in the main banks – the mix between fixed and variable mortgages determines the speed of transmission of rate increases – the yield on deposits continues to not stand out. According to Eduardo Areilza, senior director of Alvarez
Current returns are comparable to those of 2008, when they were also around 3%. If the peaks of 2007 and 2008 are not taken into account, they are the highest since the euro existed, as data from the Bank of Spain also show.
There has also been a significant increase in just one year, when CaixaBank extracted 1.63% per client, compared to 1.71% for BBVA, 1.67% for Santander or 1.82% for Bankinter. On the other hand, last year Sabadell achieved a profitability of 2.11%.
Whichever way you look at it, the banks’ business is improving. Apart from profitability per client, profitability measured in its most common variable, ROE (return on equity), stood at 9.9% at the end of June, 2.1 points more than in the previous quarter, with which finally means that banks remain in the double-digit range and are close to the European average, 10.4%.
Alvarez
Banks also increased revenue per branch. Santander, with 292 million euros, occupies the first position in performance per branch, compared to 252 million for Bankinter, 208 million for BBVA, 195 million for Sabadell and 177 million for CaixaBank. Ibercaja, with 74 million, is the one that earns the least.
The improvement in performance per branch occurs in a context of continued reduction in the number of them. CaixaBank is, with 3,911, the one with the most, after reducing the figure by 0.9%. Santander has 1,884, 1.3% more, and BBVA, with 1,883, the same as a year ago.
Areilza predicts that, given the foreseeable maintenance of interest rates at 4.5% and the liquidity levels of the banks, the remuneration of bank deposits “will rise”, but will not foreseeably reach 3%.
However, there will be a progressive transfer of money in checking accounts to deposits. If now 10% of the nearly 1.3 trillion euros saved by individuals and companies are in deposits, that is, about 130,000 million, the forecast is that this figure will reach 35%, which implies a transfer of 325,000 million , up to 455,000 million.
However, this transfer “would take between four or five years at the current rate of 6,000 million euros,” explains the Alvarez manager.
Regarding the granting of credit, the volume is slowing down. There is a shortage of mortgages, consumer loans and loans to companies, many of them financed thanks to the ICO. “Individuals are paying off their mortgages, which is the correct financial decision, and the key now is whether unemployment is impacted by rate increases,” says the firm.
