Bank of Spain warns strengthen governance and risk management in banking After Credit Suisse’s crisis in the industry and the bankruptcy of Silicon Valley Bank (SVB). The institution’s vice president, Margarita Delgado, stressed at a conference organized by PwC that the exposure of Spanish banks to the Swiss financial institution is “now” and that a crisis similar to that of the SVB “is unlikely in our country.” continent”. At the same time, Delgado stressed that “the current European solution framework is sound”, although they are waiting for the European Commission’s proposal on organizations’ behavior to outline some elements.
In any case, Delgado highlighted the need to strengthen the governance framework of institutions, as it is not possible to predict events of this scale. “Crises traditionally expose failures in government and the management of different risks,” he said. This was the incentive to improve the European and Spanish financial system since then. “he made big strides”.
That same morning, Alejandra Kindelán, president of the banking employers’ association AEB, stepped forward to confirm that “there is no risk of contagion” among Spanish banks. “In Spain we have the best banks in Europe and possibly the world; we have the best banks and the best bankers,” he said at an event at the New Economic Forum.
Differences between Spain and Europe
They conveyed a message of calm from the Bank of Spain. Differences between European and American markets. “This bank’s business model cannot be compared to that of European banks.” The guaranteed amount and high investment in long-term fixed income are the ones most hit and worst positioned by the Federal Reserve’s gradual increases in interest rates.
“In Spain, on average 66% of deposit guaranteed“, the vice-governor insisted, whereas in the SVB it only reached 11%. Likewise, 96.5% of owners (60.4 million Spaniards) have accounts under 100,000 euros, which is “basically a retail qualification” A figure that makes it relevant. Deposits in Spain have traditionally been much more stable”.
Related news
Another element of difference, rLiquidity requirements required in Europe and therefore Spainapplies equally to all banks. The average short-term liquidity ratio in Europe is 165% (184% in Spain and 118% in the USA), and the quality of liquid assets, mostly cash and cash, serving to meet this ratio is “very high”. Reserves in central banks.
Bank Association
Finally, Delgado reiterated that European banks are “positively positioned to face increases in interest rates,” as assets are repriced higher and faster than liabilities. In addition, financial institutions in the region are subject to an interest rate risk management framework “subject to close scrutiny by both European and national authorities”. For all these reasons, the deputy governor stated that this week’s banking crisis “serves to reflect the importance of the global regulatory, regulatory and resolution framework”. To serve to complement the Banks Associationblocked by Germany so far.