Our country possesses a group of solid, profitable, and efficient entities.
Recent interventions by supervisory authorities regarding several regional banks in the United States and a historic Swiss bank have led to understandable concern about the health of the European banking system.
However, this has also been a favorable opportunity to showcase the results of the reforms undertaken by the European Union since the 2008 financial crisis. Based on a Single Rule Book, the countries integrated into the Banking Union now possess a solid banking system, capable of effectively financing the European economy and resilient in the face of uncertain situations such as the recent ones or the now-overcome pandemic. Spanish banks are fully integrated into this European system and participate in the common supervision of all Eurozone entities (Single Supervisory Mechanism).
Furthermore, Spanish banking groups operate a geographically diversified retail commercial banking business model, based on attracting savings and providing services and financing to businesses and families. This is a proven model that provides high recurring results and allows, by maintaining a continuous relationship over time, for the fulfillment of all the financial needs of savers and investors.
The success of this model was clearly demonstrated by the results obtained during 2022. Spanish banks present profitability ratios above the average for Eurozone banks, measured both on assets (ROA) and on equity (ROE); the latter, at 10% last year, reached levels where the cost of capital is situated. These results have been achieved thanks to the proven ability of their directors in risk management and high efficiency—among the best in the European Union—while also maintaining a comfortable liquidity position, with ratios above regulatory minimums.
The fact that our country possesses a group of solid, profitable, and efficient entities constitutes a fundamental value for the adequate financing of productive activity, innovation, growth, employment, and the transition toward a more sustainable and socially responsible economy.
Santiago Pernías Solera, Public Policy Advisor at the Spanish Banking Association
