The six banks listed on the Ibex 35, Banco Santander, BBVA, Caixabank, Banco Sabadell, Bankinter and Unicaja Banco, do not expect that the conflicts they have with some clients in mortgages or ‘revolving’ cards will increase litigation. The entities provisioned just over 4,000 million euros for these legal issues in 2022, a slightly lower figure than that registered in 2021, according to the financial reports submitted by the entities to the National Securities Market Commission (CNMV).
Of the large banks listed on the stock market, Caixabank has been the entity that has made the greatest effort in provisions for this item: a total of 1,860 million euros, but it is a figure significantly lower than that of 2021, for which the entity expects that the result of the judicial processes is favorable to him.
Caixabank’s annual report explains that “the 2020 financial year was marked by very irregular flows, conditioned by the effect that the health crisis and the State of Alarm also caused in the normal functioning of the Administration of Justice, although it may need to normalize its operation 2021 and 2022” and that they maintain “the appropriate provisions during” for possible disputes related to the granting of mortgage loans to consumers such as land or multi-currency clauses as well as mortgage expenses.
On the other hand, the entity chaired by José Ignacio Goirigolzarri has not made provisions related to the IRPH (the reference index for mortgage loans) considering that the entity’s mortgages referenced to it meet the transparency criteria required by the courts. In the case of Bankinter, the provisions derived from multi-currency loan contracts are mainly included, where the bank still has pending claims. At Banco Sabadell, the bulk corresponds to the possible return of the amounts received as a result of the application of the so-called floor clauses.
Industry sources show that bank litigation is decreasing. The years in which they had to provide a greater amount of money for this item were in 2016, 2017 and 2018, with 4,897 million, 5,652 million and 5,289 million, respectively, according to the Bank of Spain, because they coincide with the ruling union that condemned the bank to return the mortgage expenses in those same years.
Before, they also had to do so due to the ruling on the floor clauses, so it is logical that as the affected customers who complained have been getting their money as the courts have done their job, the total amount provisioned is each lesser time. Precisely, both BBVA and Bankinter have also reduced the volume of these provisions, reaching 783 million euros in the case of the first entity, and in Bankinter it does not reach 100 million euros.
Lower provisions for revolving cards
The other great judicial front that the bank maintains is related to revolving cards, which grant a type of credit by which all purchases are deferred, which only increases the debt. In this regard, sources in the sector recall that this type of product is being limited by banks for this reason.
In addition, the Bank of Spain and the judiciary seem to be working with a more adjusted bar for this type of card, which would be higher than the current one. This would mean that many of the claims that in principle would result in a refund will not have their outcome so clear, explain these same sources. In this regard, CaixaBank and its card-issuing subsidiary, CaixaBank Payments and Consumer, received a collective action filed by an Association of Consumers and Users (ASUFIN) that was partially dismissed.
The entity headed by María Dolores Dancausa, for example, found that there was a strong influx of lawsuits related to this product, which reached the ceiling in the first quarter of 2022.
