The large Spanish banks have an efficiency ratio, understood as the necessary expenses they incur to obtain income, above the large European groups despite the inflammation and the increase in personnel costs, as a result of the salary increase to end of the year by the banking employers and that implied a 4.5% increase to approve wages that came into effect in this first quarter.
And it is that the group of Spanish banks has managed to place this metric below 50%, an objective to be beaten, according to analysts, since it means that Spanish entities spend less than 50 euros gross to achieve gross income of 10 0 euros . For this, efficiency plans have been essential, which include digitization, which offset the rise in costs due to inflation, including wages. But without forgetting the historic rise in interest rates and its effect on the Euribor, the index to which most variable-rate mortgage loans are referenced (the price of money has gone from 0% to 3.75% in less than one year).
Among the large banking groups, Bankinter stands out. The entity headed by María Dolores Dancausa closed the first three months of the year with an efficiency ratio of 35.65%, that is, the bank spends almost 36 euros to earn 100. This means an improvement of almost 6 percentage points in the data for a year ago, when it stood at 41.57%. For the consulting firm Accuracy, “the consolidation process of the entities and the strong commitment to digital transformation, which means that the efficiency ratio of Spanish banks is well above the European average”, has been key.
The rest of the large Spanish banks have also improved this percentage. Thus, BBVA is the entity with the second best efficiency ratio at the end of the quarter. The bank chaired by Carlos Torres placed it at 43.3%, compared to 44.6% twelve months ago. It must be taken into account that BBVA has focused precisely on the use of technology and, of the 2.6 million new customers that were acquired in the quarter, 64% came through digital channels. Also with a declining efficiency ratio is Banco Sabadell. Specifically, it stood at 43.50%, which represents a drop of 4 percentage points compared to the data for 2022, when it stood at 47.98%.
Banco Santander could also improve its data on expenses and gross income to digitization. Thus, the entity’s CEO, Héctor Grisi, pointed out, during the press conference to present the results, that “the cost base fell 1% in real terms thanks to the transformation of our operating model, which compensated for both inflationary pressures such as investments in technology and digitization”. And this despite the fact that the entity showed a general increase of 4.5% for the entire Santander Spain workforce.
Finally, Caixabank and Unicaja Banco stand out, with an efficiency ratio of 48.2% and 48.6%, respectively, although in the case of the first bank the cut has been 37% in the last year, since it reached 76.4% in the first quarter of 2022. For Unicaja Banco, the ERE has been key.
Unicredit, the only European bank that competes with the Spanish
As for European banks, only Unicredit manages to keep up with Spanish entities. The Italian bank placed the ratio at 39% in the first three months of the year compared to 43% in 2022. In addition, it is the only large European bank whose metric is below that 50% set as optimal The second best The data comes from Barclays, with an efficiency ratio of 57% compared to 63% a year ago. This figure has been possible because the British bank has experienced the largest increase in its gross margin thanks to the rise in interest rates, and its cards and payments division has increased its income by 47%.
ING also manages to anchor the difference between costs and gross income at around 50%, at 58%, down two percentage points from a year ago despite the fact that most of the increase in costs is due to personnel expenses. Between 71% and 76.4% move Deutsche Bank and BNP Paribas, but in the case of the French entity it represents an increase of 3.40 percentage points compared to a year ago. On the other hand, UBS saw its ratio worsen as a result of a dispute over some mortgage assets in the United States, closing the quarter above 82.5%.