The European Central Bank (ECB) has decided to toughen the requirements for good quality capital of almost all Spanish banks and the entire euro zone for the year 2024, in which high interest rates will continue to make financing more expensive and exert pressure on loans.

Yesterday, Santander became the last of the six large listed banks to report on what are known as “minimum prudential requirements” for 2024, with which the ECB has been using the balance sheet of euro zone entities year after year since 2010. . It requires each one separately to have a minimum basic capital – shares, reserves, preferred and bonds – in relation to its assets, as part of a supervisory activity known as SREP, for its acronym in English.

The result for 2024 is that Spanish banks will be required to pay 6,055 million euros more. All of them pass the requirements with flying colors, but when the approval threshold is raised they will have less room to distribute dividends, repurchase shares or undertake acquisitions. The ECB itself accompanies this hardening with a speech in which it does not stop asking European banks for prudence and restraint.

Santander, the only Spanish bank considered systemic at a global level, must have 9.6% of good quality capital in relation to assets in 2024, above the 8.91% for 2023, which is equivalent to 4,341 million more. Its current capital level is 12.35%, well above what is required.

For BBVA, the minimum has been raised from 8.72% to 9.09%, which is equivalent to 1,324 million euros more. It is a percentage still far from its current 13.25%, which still gives it a cushion of about 13,000 million that the entity is using in measures such as share buybacks.

The third bank with the highest requests is Sabadell, which is asked for 8.93% for next year, compared to 8.65% for the current one, which represents an increase of 226 million euros. The bank, which has part of its business in the United Kingdom through TSB, once again comfortably complies with what is demanded of it, having a ratio of 13.13%.

CaixaBank, whose quality capital ratio is 12.26%, must have a cushion equivalent to 8.58%, just seven hundredths more, or 134 million more. The requirement for Bankinter is also reduced, by eight hundredths more, to 7.8%, or 30 million euros, so the pressure hardly changes from its current ratio, 12.48%.

Unicaja, on the other hand, is the only Spanish bank from which the ECB does not ask for more. It remains 8.27%, which covers the best ratio among all entities, 14.5%.

The discourse of the Spanish banks is that the prudence required by the regulator must be compatible with incentives for shareholders that increase the stock market value, which in many cases is still below the book value, that is, its accounting value.

Despite the high profits, the rating agency Moody’s places the rating outlook for European banks as negative in a recent report. According to him, in 2024 default rates will increase slightly, although perhaps more intensely in countries like Sweden, and the granting of credit to households and companies will contract.