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Western EuropeSeptember 2 2003

Cajas in battle with authorities

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Spanish savings banks, or cajas, have come under fire from the government and the Bank of Spain, while commercial bank competitors gripe privately. Juan Ramón Quintás, chairman of the Confederación Espańola de Cajas de Ahorros (CECA), the savings bank association, spoke to The Banker, after saying he was “perplexed” by such attacks.

The governor of the Bank of Spain has told the cajas to be more transparent, and to hold back from opening more branches and from buying industrial shareholdings.

By the end of the year, we will probably surpass the commercial banks in deposits volumes, and in a couple of years, the same will happen with our loan portfolio. Last year, banks said they were going to increase their market share, but this has not happened. If you set targets to recover your importance in your domestic market once you are back from Latin América and you do not achieve them, it is understandable that this raises concerns.

The first version of the recent so-called transparency law was so technically demanding for the cajas that it would have created a paralysing bureaucracy for us. So we fought these aspects and managed to change 90% of them. But we have asked the European internal markets commissioner to make the cajas subject to all transparency regulation aimed at public limited companies (plcs).

The governor’s remarks came once the transparency issue had been solved, so we thought: “Has another battle started?” We spoke with the governor and he said that even though the law allows us to do everything, since each day our business looks more like the banks’, it also entails a higher risk and it would be good if the cajas retained some of those anticyclical characteristics that provide stability to the economy.

The new cuotas participativas [similar to shares but without voting rights, designed to increase the funding means for the cajas] will be listed on the stock market, rather than as fixed income securities. Do you agree with this formula?

Some cajas have expressed their disagreement with this, as they think that they are too similar to shares and they fear that this will propitiate the idea that the cajas are shifting towards the world of the plcs. The industry is divided on the issue.

What is important is that the cuotas are listed in an organised market that can guarantee a great deal of liquidity.

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