The banking industry has undergone a dizzying turnaround in the last ten years—the lifespan of this magazine—changes that represent only a small preview of the great transformation ahead. Digitalization, the shift in mindset among financial service providers and clients, new regulation, and the completion of the European banking union suggest—along with other factors currently unknown—a sector completely different from the current one.
But let us focus our attention on these recent years, and specifically on what has occurred in the asset management industry from a banking perspective. As is well known, banks, through their extensive branch networks in Spain and their digital channels, provide their clients with a wide range of investment funds with diverse risk profiles and returns, all featuring the well-known advantages of funds: excellent liquidity, favorable tax conditions, and close supervision by the CNMV. Furthermore, our entities do not limit themselves to funds from their own management companies, but also market a wide variety of third-party products, both domestic and foreign. They thus provide their clients with access to investment funds they would otherwise not be able to reach, as independent or foreign managers do not have distribution networks in Spain. In this way, banks fulfill a dual role: on one hand, they broaden the investment horizons and possibilities for clients and, on the other, they enhance competition—an objective that is not only sought by supervisors but also generates undeniable advantages for investors.
We cannot speak of this last decade without referring to MiFID II which, as is known, greatly limits the possibility of collecting inducements for fund distribution. This tightening of fund distribution may represent a shock for clients due to its disruptive nature in a distribution model that was recognized as working well; therefore, our banks are making significant efforts to adapt to the new requirements in the most user-friendly way possible. This adaptation is facilitated by the development of digital media, in which entities have made a major investment.
This adaptation process does not end here, as possible modifications have already come to light shortly after MiFID II entered into force. The main one arises within the framework of the Action Plan on Financing Sustainable Growth promoted by the European Commission with the aim of encouraging the financial sector’s role as a driver of the sustainable economy. In this context, several initiatives have been taken. Among them, on one hand, Europe is finalizing the “ESG taxonomy”—that is, which criteria will give substance to environmental, social, and governance requirements, and how these factors will be incorporated into investment decision-making processes. On the other hand, a proposal to amend the MiFID II Directive has just been published, which aims to ensure the incorporation of these ESG criteria into the suitability test when entities perform it for their clients.
Spanish entities are closely following this proposal, so that their commitment to the economy and sustainable growth reaches the world of investment fund distribution. Likewise, they will continue to adapt to new regulatory, competitive, and market conditions to ensure that their clients have an investment fund offering that meets their savings and investment expectations in a secure yet dynamic and international environment.
José María Roldán, Chairman of the Spanish Banking Association
