Spanish Banking Pulse: Industry benchmarks, top performers and digital and ESG scores
The Q4 2021 Edition of the Spanish Banking Pulse Report, measures the performance of the Spanish banking Industry.
This year’s edition adds the A&M Digital Score and ESG score on top of the traditional financial score, to assess how each bank is facing the three largest challenges that they will face during this decade.
Key trends 2021:
- Profitability (ROE) during 2021 reaches 7.15%, doubling 2020 ratios and only 5% lower than 2019.
- The solvency of the industry improves pre-pandemic levels by 50 bps reaching CET1 by 12.8%.
- The cost of risk returns to pre-pandemic levels of 0.38%, maintaining coverage levels above 63% in anticipation of the evolution of ICO-Government Guarantee loans.
- The ranking of Alvarez & Marsal is headed by Bankinter, followed by Kutxabank and BBVA. Bankinter, BBVA, and Santander are the banks that improve their score the most.
- New rankings focused on Digitalization and Sustainability are introduced. The digital ranking is led by BBVA while Bankinter leads the sustainability ranking.
2021 Digitalization Score:
A&M has introduced a new digital score in order to measure digitalization metrics, transformation through digital adoption and management of digital risks, using publicly available information.
2021 ESG Score:
A&M has developed together with BXG-the brand experience group, a novel ESG score that combines the external market-agency views with the banking clients view to measure the level of alignment with stakeholders each bank is achieving for the ESG challenge.
Russia-Ukraine Crisis Stress Testing for Spanish Banks:
A&M has stressed the potential impact of a long Russia-Ukraine crisis together with a commodities price increase for the Spanish banking sector.
- Results imply that if the double crisis continues for a long period up to 10% of Banking loans to the Spanish corporate sectors could be at risk.
- Most affected sectors will be Minerals Manufacturing, Extraction and Mining, Steel and the Energy Sector depending on its capacity to pass through prices to consumers.
For further information please contact
Fernando de la Mora, MD fdelamora@alvarezandmarsal.com
Eduardo Areilza, SD eareilza@alvarezandmarsal.com
