The pigs are resurrected in the European Union, although with a different meaning from that of the 2008 crisis. This acronym coined by the English press to refer pejorative (its translation from English is pigs) to countries such as Portugal, Ireland or Italy, Greece and Spain returns to show the clear differences in remunerating family deposits. Banks in all these countries except Italy pay less for savings than the euro zone average.
In the case of Spain, the resistance of large entities such as Santander, BBVA and CaixaBank to enter into a battle slows down the take-off in the interest of the traditional savings product. In fact, the type of household deposits to a term of between one and two years, one of the most extended in the market, stood at 0.59% TEDR (Annual Equivalent Rate excluding commissions) in September, according to the latest statistics from the European Central Bank (ECB). This is the first fall in eight months and represents almost half of the return paid by banks on average in the euro zone (1.09%).
“There is a lot of liquidity in the system. There is not going to be a deposit war“, bluntly warned Onur Genç, CEO of BBVA, some days ago. Some statements shared by the rest of the bankers and that contravene the ECB’s policy. The central bank, in fact, has raised the deposit facility to 1.5%, which sets the interest that credit institutions receive for their overnight deposits at the central bank, in its attempt to cool down the economy.
sour cherry presses
Luis de Guindos, Vice President of the ECB, has urged banks to remunerate deposits, which for years have disappeared from the window of bank offices. And last Thursday the Government joined, which added the low profitability of the savings to the extraordinary benefits as arguments to justify the taxation.
bankersfor its part, they refute that the deposits generated losses with rates in negative since 2014 and that with the change of pace of the ECB they will be able to start covering operating costs. The sector would have to pay some 8,400 million for the savings assuming a return of 1.5%which is what the State pays for lower-risk bills.
France and Germany, at a distance
The profitability of Spanish banks is, however, higher than that offered by their counterparts for family deposits with a term of between one and two years in Greece (0.14%), Portugal (0.07%) and Ireland (0.04%). Italy leaves the worst interest group and exceeds the euro zone average, with a remuneration of 1.17%. The PIGS are far behind the great powers, such as France and Germany, whose entities offer an average interest of 1.62% and 1.49%, respectively.
In Spain, the most intense fight to capture liabilities is concentrated among foreign entities and remunerated accounts. In the first case, they stand out Deutsche Bank, which offers up to 1.8% over two years, and the Italian Banco Progetto, with interest of up to 2.7% over 24 months. Regarding digital banking, ENG has returned to remunerate the Orange Account, its flagship product, with an interest of 0.3%, while Openbank does so with 0.2% in its savings account.
CaixaBank is the Spanish bank that concentrates the most deposits, with 25% of the market share. The jump was made thanks to the purchase of Bankia in 2021. It is closely followed by Santander, which increased the portion it controls from 15% to 20% after taking over Popular in 2017. BBVA is the third bank with the most deposits in Spain, with a declared share of 13.4%.
