The vice president of the organization, Luis de Guindos, warns of the adverse effects that a measure such as limiting mortgages would have
The Vice President of the European Central Bank (ECB), Luis de Guindos, is confident that Spanish banks are beginning to improve what they pay their customers for their savings. “Sooner or later, sooner rather than later, that fee is going to go up,” he said Monday. Some explanations that come at the height of the boom in demand for Spanish debt among individuals, given the refusal of the entities to transfer the rise in interest rates to their deposits -term and sight-.
According to Guindos, the ECB has already discovered how some European entities are already improving that compensation. And he believes this competition will encourage Spanish banks to follow in his footsteps. “It is not only the competition between banks, but also that of Letters of investment funds,” he said during an interview on Onda Cero.
The industry has been arguing for months that the excess liquidity that still exists in the market does not necessitate the urgent need to raise funds from several years ago. But Guindos reminds that the ECB is already absorbing that liquidity – with the aim of buying up countries’ debts – so it is foreseeable that competition from banks will increase. “We will see an increase in pay there,” he says.
Guindos has also referred to the increase in the cost of borrowing, especially in the mortgage segment with the increase in Euribor. At the time, Christine Lagarde’s runner-up sided with some bankers, who sharply criticized the Podemos wing of the government’s proposal to cap the price of variable mortgages.
In his view, such a proposal should be heeded because of its long-term effects, warning that there is a risk of driving certain groups, the most vulnerable, out of the market. “If interest rates are capped for a particular segment, the banks’ reaction may be to stop offering that type of mortgage,” he warns.
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.
