The year 2022 was very turbulent for asset management. The world stock markets closed a year marked by volatility and inflation in the red. For the fixed income market, the year was not much better as a result of the change in the interest rate cycle by the central banks. As a consequence, the asset management business has been affected. Especially commission income. An example is Bankinter. The entity reduced commission income by 5% in 2022 in the area of asset management to 194 million euros, while its broker’s income commissions fell 3% to 111 million, the bank said during the Presentation of the annual accounts for the year 2022.
On the other hand, these falls were more than offset by the income from collection and payment commissions, that is, the commissions that the entity charges to businesses for the use of cards and POS. In 2022 the increase was 27% to 165 million euros. This is nothing new. The strong commercial activity and the lower use of cash after the pandemic have allowed these revenues to register double-digit growth. Thus, in the absence of Banco Santander presenting the annual accounts, this behavior could already be seen in those of the third. The entity explained that commission income increased by 7% (14% in current euros), but the contribution of card and data derivative operations was special, registering increases of 16% and 29%, respectively.
This behavior is also extensive to other entities such as Caixabank. Also during the presentation of results for the period between June and September, the bank recognized that the improvement in this type of income offset the decrease in commissions in asset management due to the impact that the evolution of the markets had had. Thus, income from total commissions is 4.1% year-on-year, where income from recurring commissions, which include charges for payments, cards and other transaction channels, will increase 4% year on year, while those related to with the investment they fell by 1.5%. Likewise, card spending grew at a double-digit rate in the last two quarters. Financial sources also recall that Banco Sabadell acknowledged having recorded income from POS terminals and cards in the third quarter of 2022.
The use of cards skyrockets
The truth is that banks have promoted the use of credit cards. It should not be forgotten that when a customer pays for a purchase with a card in a business, the owner of the POS charges a commission to the business, which is known as the discount rate. This interest in promoting the use of cards has meant that the banks have still pushed this charge down. The average, according to data from the Bank of Spain, stands at 0.39% in the third quarter of 2022. Just ten years ago, in 2012 this rate stood at 0.67%, while in 2022 it exceeded 1 ,5%.
And it is that according to the statistics of the banking supervisor in relation to the means of payment, the number of sales terminals has registered growth of between 7% and 8% in the first three quarters of the year, while the number of ATMs has been declining at a rate above 4.5% quarterly. This has also been noted both in the number of operations, with double-digit growth in each quarter, and in important ones.
In relation to this, operations at sales terminal points have not dropped from Imports also experienced double-digit year-on-year growth in each quarter of 2022.
Thus, taking into account the total amount of the operations, the bank has entered 660 million euros in commissions up to the third quarter through the use of point-of-sale terminals. Despite the fact that these commissions are at historic lows, the acceptance of the use of payment cards on a day-to-day basis means that commission income continues to rise, and more so in a context of strong economic activity such as 2022.