The five largest listed banks in Spain, which are Santander, BBVA, CaixaBank, Sabadell and Bankinter, have announced this week joint profits of 26,093 million euros in 2023, a historical figure that exceeds that of the previous year by 27% and that , if the forecasts are met, it will rise again in the current year.

The great catalyst for the gains has been the increases in interest rates, which have made loans more expensive without an immediate revaluation of deposits. Banks have high liquidity after the ECB’s expansionary programs and have quality capital above regulatory requirements, so they have not had to make great efforts to raise money from clients, beyond the desire to guarantee them or expand their number.

Added to this dynamic are the advances in efficiency and the good results of the business in Spain, despite the extraordinary tax on banks that the Government wants to make permanent. The country was the one that contributed the most profit to Santander’s accounts, 2,371 million, 52% more. It reached a record level of 2,755 million, 65% more, in BBVA’s results, despite the decline in the granting of mortgages and the increase in arrears. It is also, of course, the great source of profits for CaixaBank, which together earned 4,816 million euros last year, 54% more.

The rebound in Spain occurred despite the bank tax. Of the three main banks, CaixaBank is the one that pays the most: 373 million last year and predictably 500 million this year. Santander dedicated 320 million to the tax and will pay another 338 million in 2024, while BBVA will go from paying 215 million in 2023 to 285 million in the current year. The bill of the big five, together with Sabadell and Bankinter, is 1,143 million in 2023 and 1,415 million in 2024.

The presidents of the banks continue to criticize the tax, which the entities have appealed in court. Santander’s Ana Botín said that “no country in the world has an extraordinary tax beyond 2024% and regretted that banks are “discriminated against.” For BBVA’s Carlos Torres, it is “counterproductive for the economy.” while the CEO of Bankinter, Dolores Dancausa, described it as “unfair” and “discriminatory.”

Of all the banks, the one that gained the most last year was once again Santander, with 11,076 million euros, 15% more. The group, which has reorganized the business in large global areas, expects to exceed 12,000 million in 2024 and plans to allocate 5,500 million euros from the 2023 results to shareholders. It is 50% more than in the previous year.

BBVA earned 8,019 million, 26% more, thanks not only to Spain, but also to Mexico, which has become the most interesting market to invest its surplus capital, standing at 2,400 million euros. The bank has also opted to accelerate the distribution of dividends. The remuneration is equivalent, as in the case of Santander, to 50% of the profits.

CaixaBank goes further and places the percentage of profits that will be distributed among shareholders at 60%. Its president, José Ignacio Goirigolzarri, assures that, of the dividends paid, “half will revert to society through the La Caixa Foundation and the FROB.” “In an environment of normalization of interest rates, we have capitalized on the scale and competitive position that we achieved with the merger,” he stated, referring to the integration with Bankia in 2021.

Banc Sabadell increased its profit by 55%, to 1,332 million euros, of which almost 15% comes from the British subsidiary TSB, which contributed 195 million and in which an efficiency plan will be applied on which the bank does not has offered details. If applicable, the remuneration to shareholders will increase by 55%.

Bankinter earned 845 million euros, 51% more, and expects to maintain “stable” income this year, according to its financial director, Jacobo Díaz. Rising costs in the fourth quarter of the year caused the bank’s shares to fall 6% on earnings day.

The banks agree on the forecasts that this year the ECB will begin to lower interest rates. The CEO of CaixaBank, Gonzalo Gortázar, estimates that mortgage payments will decrease by an average of 20 euros, although Botín assured that the relief will be greater, up to 70 euros per month.