The six entities of the Ibex-35 continue without passing on the rise in ECB interest rates to their customers’ savings
Larger volume of deposits without the need to increase the remuneration offered for it, despite the increase in interest rates by the European Central Bank (ECB) that other major entities of the Old Continent have already started transferring to their customers’ savings in the form of increased profitability.
According to data collected by Europa Press, the six entities listed on the Ibex-35 (Santander, BBVA, CaixaBank, Sabadell, Bankinter and Unicaja) together increased the volume of their company’s deposits in Spain last year by 5 in their view. .24% raised and term deposits.
Santander Spain is the bank that registered the largest increase, with an increase of 16.9% and a volume of EUR 341,701 million, with a special incidence of individual deposits, but without taking into account repurchase agreements (CTA), the increase is 14%. “Despite a complex macroeconomic environment, we grew the customer base by more than 700,000 customers by 2022, growing in all quarters of the year,” the entity said in its full-year financial report.
For its part, BBVA increased its deposit volume in Spain by 6.68% to EUR 220,471 million, while CaixaBank kept the figure virtually unchanged at EUR 355,962 million.
Within medium-sized banks, Sabadell increased its customers’ deposits by 2.7% to EUR 122,701 million and Bankinter by 2.9% to EUR 72,902 million. Unicaja Banco was the only entity to see the volume of deposits fall by 11.6% to EUR 74,386 million.
The overall improvement – not just in large entities but across the industry – in deposit rates also comes at a time when households have had to throw away significant savings to cope with the 2022 cost-of-living rise. Economic uncertainty has weighed more heavily and the volume of deposits – taking into account only that of households – just set a new maximum in January, exceeding a trillion euros for the first time in history, according to the latest data from the Bank of Spain .
And it is that post-pandemic deposits have been the great savings option for families, with a decidedly conservative nature. Due to the start of the interest rate hikes since last summer, households expected an improvement in the return on their savings. Nothing could be further from the truth. Official statistics show a minimal evolution in this area.
Specifically, the average interest paid on demand deposits (current accounts) – where most savings are concentrated – remains unchanged at 0.015%. The average of time deposits has improved somewhat, to 0.067% from the 0.064% at the end of 2021. But behind this slight increase is rather the supply of foreign entities or the so-called neobanks (only digital activity) .
The fact that the big banks currently have enough liquidity to meet the demand for credit has meant that they are in no rush to stir up the liability war to attract customers. Something that conflicts with the decision to transfer interest rate increases to credit, making their loans more expensive.
Faced with this situation, many individuals are opting to invest in other safe assets such as treasury bills, which are in huge demand recently. Conscious of the environment, banks have begun to improve their offerings of other types of products, such as paid bills, that offer a little more profitability in return for meeting certain requirements. They have also started marketing investment funds that refer to government debt, given the renewed interest from their retail clients in this asset class.
Source: La Verdad
I’m Ben Stock, a journalist and author at Today Times Live. I specialize in economic news and have been working in the news industry for over five years. My experience spans from local journalism to international business reporting. In my career I’ve had the opportunity to interview some of the world’s leading economists and financial experts, giving me an insight into global trends that is unique among journalists.
