In recent weeks, Spanish banking has once again been at the center of a legal debate that has ended up taking on a damaging social tone which, once again, confuses consumers and calls into question the constant effort made by the sector to contribute to economic growth, job creation, and the well-being of citizens. Contrary to the perception of many agents, banking is not a sector governed by the premises of a zero-sum game in which what one player wins, the opponent loses. Not at all. Banking increases its profits when the rest of the economic agents enjoy an expansive and sustainable cycle framed by stable and transparent rules and behaviors.
In fact, the commitment of Spanish banks to resolving their customers’ needs is materialized in multiple dimensions. At this time, despite not yet having achieved profitability above the cost of capital, the banks linked to the Spanish Banking Association (AEB) are making a notable effort to adapt to digital transformation, investing more than 1.7 billion euros each year (representing nearly 6% of the GDP induced by the operational activity of our banks) with the aim of continuing to increase productivity and satisfying the needs of customers who, legitimately, demand the option of being able to operate with their financial entities through any channel under highly competitive conditions.
In this sense, the greater efficiency of banking in Spain compared to other European Union countries, combined with an operating model based on a close, stable, and lasting relationship with customers, has allowed consumers to enjoy fees that are 58% lower than the average charged in the main EU countries. Furthermore, up to 115 financial services are offered in Spain compared to the average of 82 proposed in the EU, of which more than 75% are offered free of charge and through different channels for the greater convenience of customers.
Among these, in line with the unexpected Supreme Court ruling on the determination of the taxpayer for stamp duty (AJD), the role played by banks in the free collaboration they provide in tax management stands out, due to the obligation the sector is subject to by the tax administration. This service helps facilitate tax payments for citizens and also benefits the Public Treasury, as it transfers part of the collection management costs to the banks. It is a service that Spanish banking offers without fees for the customer despite the high cost it entails for entities in terms of technology and adaptation to tax regulations. In the rest of the EU, this service is only offered by Italian and Portuguese banks in exchange for a considerable fee charged to their customers, regardless of the channel used for tax payment.
Spaniards have the privilege of living with an exemplary banking sector that has known how to overcome the adversities of the past economic crisis, contributes to economic growth, and strives on its own—while complying with demanding European regulation—to generate a framework of trust and transparency for the benefit of consumers. Therefore, at this time, it should not be put at risk with destabilizing proposals.
Citizens have the right to be demanding, and institutions must promote—as is already the case in our country—that Spanish banking is represented by a wide diversity of business models in which any customer feels supported by one of the large multinational banks, regional entities, cooperatives, niche banks, or digital natives. These entities, with different strategies, specialties, and locations, allow for the maintenance of a competitive financial industry and a wide range of products and services for the benefit of the consumer. Maintaining and strengthening these lines of action is the best way to ensure that the constant evolution of the financial system translates into a solid and effective banking sector.
Conversely, the increase in legal uncertainty and the lack of clear and predictable rules in the credit field harms all stakeholders involved due to its impact on expectations, puts at risk a model that has been exemplary for decades, and once again questions the trust in a sector that has facilitated access to home ownership for more than 80% of Spanish households.
In short, it is essential to preserve legal certainty and for the banking sector to return to operating with stability and transparency, for which it will be necessary to look forward and leave behind any interpretation or proposal that distorts the past.
Juan Carlos Delrieu, Director of Strategy and Economic Analysis at the AEB
