The banking storm of recent weeks, ghost return of a new financial crisis come over the markets World. It still weighs heavily on the memory of everyone who lived it. panic which led to the bankruptcy of Lehman Brothers in September 2008. Impacts up to 2014 had successive tsunami waves. Great Financial Crisis And great recession. later reform generally editing, controlling, and analyzing banks that led the Spanish sector to own EUR 45,886 million and 27% more capital to absorb losses – these days it is giving its first big test with fire.
both Spanish authorities Some prominent bankers have rushed out these days to ensure the state of the country’s banks. they have nothing to do Caused America’s Fall Silicon Valley Bank and Switzerland Credit Suisse or now reel Deutsche Bank. But are they right or a repeat “Spain maybe stronger financial system The international community that President Zapatero proclaimed in New York in September 2008?
Changes in both the data and the institutional structure of bank control point to major differences. “It is known how financial crises begin, but not how they end, because loss of confidence owned by investors unpredictable results. But if we go to the basics, the situation makes no sense. It has nothing to do with 2008. and the Spanish sector is catching up to us much stronger situation. can never be excluded scaresbut they seem so much today, not likely“, characterizes one of the great bankers.
Solvents and liquids
The data points to something deep transformation Sector of Spanish banking in this nearly 15 years thus ended at the end of September. 214,117 million Tier1 Euro (better quality capital plus convertible bonds), compared to 168,231 million at the close of 2008. assets from 3.28 to 4 trillion euro, but reduced assets measured by risk that they think will harm their two to 1.5 trillion. This is the weight of capital on these risk-weighted assets. 8.1% to 14.26%.
Banks are therefore bigger but they have less risk and one old piggy bank bear potential losses. We also have more liquidity facing deposit outflows as failed banks are exposed to. Thus, the liquidity coverage ratio (LCR, the result of total liquid assets divided by short-term payment liabilities) is: 199%, twice the amount needed by the authorities 795,806 million beds Euros to cover obligations of 398,934 million. It’s incomparable because in 2008 there wasn’t even a requirement to create it.
The bursting of the real estate bubble also resulted in a major improvement in the most fundamental liquidity ratio. deposit loans. went down 100.8% from 195% 2008 (loans doubled the deposits businesses needed to finance themselves to a greater extent in floating capital markets). This guiltOn the other hand, similar to then (3.48% in January compared to 3.37%), but it’s light-years away from the all-time high of 13.61% reached in 2013. in an unusual way no longer reaching, but approaching. This public debt portfolios on average they make up about 13% of assets and are mostly held to maturity (77% of the total), guaranteed deposit Average amount – up to 100,000 Euros per institution and customer about 66%.
More and better control
Why this extraordinary development? Antonio CarrascosaFormer director of the Regular Bank Restructuring Fund (FROB) Spanish and former chairman of the Single Decision Board (JURY) the number of banks is clear: “European model health: supervision only one works fine and resolution unique too. HE Single Resolution Fund Donate will expire next year. 80,000 million when the euro and Italy signed, MEDE can give you similar amount in case of need. left to create. Deposit Guarantee Fund common, sharpen the frame for resolve middle entities clarify whether there is public interest in the decision and standardize some elements of the decision national bankruptcy laws. However, the entire corporate schema, Much stronger than 2008“.
After the debacle of that year, thus, international architecture under the control of banks authentic revolutionpromoted by the G-20. hardened accounting regulations (Basel II to Basel III) and principles on the supervision of institutions and the resolution of troubled banks. in the European Union, supervision The decision of the big banks that moved from countries to the European Central Bank (ECB) was undertaken by the new Central Bank. Single Resolution Board. In addition, regulation has been strengthened with the creation of regulation. European Banking Authority (EBA) And European Systemic Risk Board to monitor global threats to financial stability.
isolated cases
“Risk in the European Union scattered national solutions to troubled banks less than 2008Because we have the European Commission, the ECB and the SRB and a law that covers the whole process and provides a lot of security. dir-dir important HE keep the draft The solution arising from the 2008 crisis, because otherwise banking crises will accompany dominant crises “In terms of the state finances of countries at risk of bailing out their institutions,” says Carrascosa, current foreign adviser to the International Monetary Fund.IMF) for technical assistance on the financial system of several countries.
The question that may arise is how is it possible for banks to fall again if everything has improved so much. “In SVB, the authorities were wrong by taking the bank into liquidation instead of a solution because he was not aware of it. risk of transmission to the financial system. When it went into liquidation, the deposit guarantee fund was activated, but only 5% of the deposit was guaranteed. And at Credit Suisse, solution framework not implemented, but only some of the powers it allows. In both cases, He should have started acting much earlier to prevent assets from getting into this state. However, I do not think the infection will spread further, because although could have been done betterThe main problem has been solved,” he says.