The request of the Vice President of Economic Affairs, Nadia Calviño, that the banks remunerate the liabilities has fallen on deaf ears for now. At least with regard to two of the four large Spanish banks (CaixaBank and Sabadell) that this Tuesday made the decision subject to what the market demands.
In the seminar of the Association of Economic Information Journalists (APIE) of the Menéndez Pelayo International University, in Santander, the president of CaixaBank, José Ignacio Goirigolzarri, assured that in the matter of deposits “what happens in the future will be what what the client says. He assured that they will adapt to market requests, although, in any case, he made it clear that “the ones who have to make decisions in terms of pricing policies are the banks.”
Goirigolzarri acknowledged in his speech that what is paid for deposits in Spain is below the European Union as a whole and recalled that when rates were negative, companies were charged for deposits and individuals were not. And now that rates are recovering, it’s just the other way around.
In a study by the Bank of Spain published this Tuesday, the supervisor warned that in the euro zone “interest rates for new banking operations in April 2023 exceeded the levels registered before the start of monetary expansion in 2014, except in the case of term deposits of households in Spain”. The average return on one-year retail deposits stood at 1.33% in April, compared with 2.27% in the euro area.
In Goirigolzarri’s opinion, the bank’s deposit strategy “should not affect the reputation of the sector” because there are alternative products with good returns. According to him, deposits are not a good savings strategy in the medium and long term since there are other more beneficial formulas such as funds or other investments.
From Banc Sabadell, the CEO, César González-Bueno, who also participated in the seminar, assured that the remuneration for “term deposits is arriving and progressively”. However, he added that “with all due respect to the vice president, it will not be because she says so” and listed a whole list of products marketed by the bank that offer optimum returns and are guaranteed. The first executive of Sabadell also used data from the Bank of Spain to indicate that on the asset side, mortgage prices in Spain are lower than the Euribor.
In the same forum, the president of the banking employers’ association AEB, Alejandra Kindelán, declined to comment on whether the delay in transferring the rate hike to Spanish clients generated a good or bad reputation for the sector. In her opinion, “it will be the entities themselves and the dynamics of competition that will have to resolve” the situation. On the role of the banking associations, Goirigolzarri said that “the employers have nothing to say in price policies, it would be tremendous, a bad practice.”
And in the midst of this scenario, the ING entity assured in Santander that they are attracting resources with their offers on deposits. The CEO of ING for Spain and Portugal, Ignacio Juliá, stated that in the first five months of the year they had captured 1,300 million in deposits.
Regarding the economic situation, the Chairman of CaixaBank stated that “it is showing much greater strength than what we anticipated last year” and pointed out that its main weaknesses are “productivity and the imbalance of public accounts”. In this sense, the manager once again stressed the risks of the Spanish economy moving away from that of the Eurozone in terms of GDP per inhabitant. Regarding the evolution of the bank, he assessed the performance of the activity after the merger.
Instead, González-Bueno reviewed the evolution of the bank in recent years since the merger negotiation with BBVA broke down. For this year, he recalled that “if the analysts say that we are going to earn 1,000 million, the savings are of the order of 270 million.” In relation to the commercial strategy, the manager valued the digitization process.
