Banks in the euro zone have just fully allayed fears caused by the first major banking earthquake in more than a decade, centered in California and Switzerland. Their recently presented semi-annual results and the recent stress tests of the European banking authority, which were easily passed, distance them from the crisis of confidence unleashed by Silicon Valley Bank and Credit Suisse just four months ago. Uncertainty now returns to those typical of the new cycle of interest increases: the risk of economic slowdown and the foreseeable increase in delinquency.
Except for Deutsche Bank, which earned 7% less in the first half, the main European banks have sharply raised profits. The largest in the euro zone by business volume, BNP Paribas, has earned 7,245 million, 46% more than a year earlier, while the Italian Unicredit has almost doubled earnings, up to 5,934 million. The French entity Société Générale has left behind losses of 236 million a year earlier, while the second largest German bank, Commerzbank, earned 950 million, 64% more. Credit Agricole obtained a profit of 2,481 million, 9% more.
Of all these figures and percentages, the determining factor is that a good part of the entities have beaten analyst forecasts in the semester, which reconciles them with the markets that harshly punished them in March. BNP, BBVA or Deutsche Bank are taking advantage to buy back shares, which is an indirect way of improving shareholder remuneration.
Spanish banks have also participated in this feast of profits. The six listed companies, which are Santander, BBVA, CaixaBank, Sabadell, Bankinter and Unicaja, have added profits of 5,373 million in the semester, 49% more, despite raising provisions in some cases. The feared delinquency has not yet made an appearance, and the banks say they have high liquidity, despite having repaid a large part of the special pandemic loans to the ECB. They don't seem to be in too much of a rush to raise deposits.
Uncertainty now points to the effects of interest rate hikes on the economy. The credit rating agencies Moody's and S
"This euphoria over the current and future results must be treated with great caution, since it will be subject to the future of macro and even national events in the coming months," says José Luis Cortina, president of the Neovantas consultancy.
In the latest EBA stress tests, which are published every two years, Spanish, Irish or Dutch banks do better than German ones. In the worst scenario, the 111 euro zone entities analyzed would reduce their good quality capital from 15% to 10%, a percentage similar to that of two years ago. However, the European authority warns that the banks themselves expect a worsening of this ratio from now on.
