The supervisory director of the Bank of Spain, Mercedes Olano, has stated that “in no case” will the organization allow banks to soften the criteria of credit granting, given the foreseeable scenario of lower interest rates. “(Credit risk) is the first risk for the European financial system. European banks, in general, have a commercial banking business model focused on credit, therefore we are already tremendously vigilant,” he indicated during the presentation of the 2023 Supervision Report.


Olano has explained that, given the foreseeable lowering of rates that the European Central Bank (ECB) starting in June, banks will have to increase the credit business to maintain your intermediation margins. However, he has ruled out the possibility that this increase in the concession will be made through softening the criteria.

“I don't know if there is going to be credit growth after the latest news on the geopolitical situation. I don't know how (the conflict between Israel and Iran) is going to affect credit,” he also explained, before referring to the fall in credit granted to households, especially the mortgage, where in fact there has been a reduction in the balance due to the use of the savings that families accumulated during the pandemic. In the case of the companiesOlano has pointed out that the fall occurs in long-term financing, but not in credit for working capital.

However, he has assured that credit risk continues to be a supervisory priority and will continue to be so for “many years.” Thus, he has been blunt on this issue, where he has also explained that actions have already been carried out to review whether the criteria for granting credits have been softened, and they will be done again “if necessary.”


Sanctioning files and supervisory actions

In the Supervision Memory corresponding to 2023, you realize that the Bank of Spain processed 11 sanctioning files in 2023 against entities and their administration and management positions, which have affected at least 54 individuals.

In particular, in the prudential field Nine files were processed that affected those 54 people. Of these nine files, six were resolved in 2023.

On behavior supervision –work that aims to verify whether entities comply with the regulations of transparency and customer protection–, the Bank of Spain carried out 153 supervisory actions concentrated, fundamentally, in the areas of accounts and deposits (43), from Consumer credit (34), from payment services (26) and real estate credit (24). Another 26 went to advertising, customer service, financing for SMEsetc.

As a result of the supervisory actions carried out, the Bank of Spain initiated a sanctioning file and formulated 101 briefs of requirements and requests for cessation or rectification of conduct, of which 57 were made within the framework of the supervision of advertising activity, and 76 were written with recommendations and clarifications.


Looking ahead to 2024, the report highlights the Bank of Spain's objective of increasing the weight of on-site inspections to the bench during this exercise.

Commercial premises

Olano also referred during his speech to the surveillance that the countries of the European Systemic Risk Board (JERS) has been involved in the commercial real estate sector for two years, which in the United States has caused some tensions.

However, the Director of Supervision of the Bank of Spain has stated that, for now, it does not represent a problem for the country, taking into account that the weight of this activity in the total credit balance to the private banking sector is 8%. , a “reduced” percentage, a figure that does not include credit to promoters.

You have specified that the credit to commercial real estate It is concentrated in offices, stores and hotels, but not in more risky assets, such as shopping centers. “As the tourism industry is doing well, we do not expect major problems in this way. I find it difficult if there are problems in Europe that directly infect Spain,” he stated.

Olano, however, has clarified that there could be some risk in the office center business, given the rise of teleworking, as well as in the physical points of sale of businesses, which increasingly carry out more transactions digitally.

“All cyber incidents must be reported”

On the other hand, the Director of Supervision has referred to the two falls suffered by the Redsys payment platform in November and whose operation is under supervision of the Bank of Spain. Olano has indicated that actions have been taken, the reasons for these falls have been investigated and “recommendations” have been made.

However, he wanted to point out that this event “connects” with the concept of infrastructure cyber resilience, which goes beyond stopping cyberattacks, a problem that supervisors and entities have focused on in recent years. “The attacks are going to come in. The important thing is to have recovery systems that allow the service to be returned quickly,” he stated, although it should be remembered that Redsys reported that the fall of its platform was caused by a technical failure, and not by a cyber attack.

Furthermore, he has pointed out that there are a cyber incident communication problem, which includes cyber attacks or internal problems; In fact, he has indicated that most of the falls occur due to internal problems. “All cyber incidents must be reported,” Olano said, also indicating that this problem could be solved with the Digital Operational Resilience Regulation (DORA).

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