The bank triggers its profit in Spain to 5,300 million euros

The vertiginous escalation of interest rates in the Eurozone has been the manna that the banks had been carrying for a whole decade and that has finally arrived. Thanks to this, the large Spanish entities have shot up their margins to levels not seen since before the Lehman Brothers explosion and this has allowed them to earn almost 50% more during the first six months of the year.. Specifically, the joint profit of Banco Santander, BBVA, CaixaBank, Sabadell, Bankinter and Unicaja reached 5,300 million euros from January to June, although out of the total profits of the six entities it represents less than half, taking into account other markets like Mexico or Brazil.

Beyond the rates, the leading swords of the sector have insisted in each appearance this week on the strength that the country's economy is showing, with a fall in the demand for credit (as is logical given higher financing costs), but without a notable or worrying rise in delinquency. In fact, in some cases, such as Banco Santander or CaixaBank, which brings defaults to a minimum of 15 years, even falling in the semester.

If these results did not include the tax paid by the sector in the first quarter, for a total of 1,120 million euros, the joint profit of the six listed entities would have been about 6,400 million, 80% more than the result of 2022.

In world terms, listed banks obtained a net result of close to 12,400 million euros, 20% more if compared to the first six months of 2022, when the first rate increase had not yet occurred, of the nine that the ECB has carried out since just one month later, since it began the race against inflation in July of last year.

GROWTH

The two largest banks in this country are the ones that have picked up speed at the start of the year. The entity chaired by Ana Botín achieved a profit in Spain of 1,132 million euros, which represents 74% more and was the clear driver of the group's result. So much so that Spain overtook Brazil and once again became the first market for the group by benefits. It must be taken into account that globally its profit grew by 7% due to the fall of the Brazilian market mainly. It amounted to 5,241 million euros.

The rise in the price of money in the Eurozone was behind the fact that the interest margin (which is the difference between what a bank pays for its deposits and what it charges for borrowed money) in Spain shot up 57%, up to 3,161 million euros compared to 2,000 million in the first part of 2022. It also added 362,000 customers in the last six months in our country.

The profit of BBVA in Spain, the second market for the entity behind Mexico, increased by almost 54% until June, with 1,231 million euros. Globally, the bank led by Onur Genç earned 3,878 million, 31% more, and in which the Mexican economy represented slightly more than half. The interest margin in our country was almost 45% higher despite a slight drop in commissions.

CaixaBank, which controls a quarter of the national loan market, registers the highest profit of all entities. The total profit of the group, which means including its Portuguese subsidiary BPI to a large extent, increased somewhat less, 36%, to earn 2,137 million.

The remaining 1,000 million profits are shared between Sabadell, Bankinter and Unicaja. Of these, only Unicaja has seen its profit fall in the semester, 13% specifically, and the entity attributes it to the payment of the tax to the sector that it paid in full before March, of 63.8 million.

stress test

Yesterday the EBA (European Banking Authority) published the so-called stress tests for the sector in which Spanish banks emerged unscathed once again. In a scenario of maximum stress in the economy, Sabadell and Unicaja are the ones that would destroy the most capital, close to 400 basis points, and even so their levels of first quality capital would fall to 8.8% and 9.7%, respectively.

The one that comes out best in the photo, once again, is Bankinter, for whom the worst crisis scenario would still allow it to continue covering the cost of capital, which historically has been set at over 10%.. Next to the orange entity are Santander and Kutxabank as the next banks that would best respond to a stress scenario.