On July 4, large Spanish banks will begin deferring to the Real Decreto, a Spanish law that will penalize any bank that offers exorbitantly high yields on savings accounts or similar deposits. The government announced this norm over a month ago in an attempt to end battles among banks who wanted to raise cash from individual clients with big deposits. Some banks have already adopted the policy.
Among Spanish banks who clearly publicize interest rates on savings deposit accounts, Popular has dropped its extremely industry-leader rate from 4.0% to 3.1%. This amazing yield was a point of reference for how the banks were paying back their high-deposit clients.
Banco Popular pioneered the interest battle when it took deposits from its Gasol deposit plan, named after the Spanish player on the LA Lakers basketball team. The bank set a high water mark in the sector and is now starting to lower it.
Sources from the bank assure that at this time they have reached "a secure position in light of any kind of market stress." At the same time, sources confirmed that they have been financed by other means, such as a debt issuance of some 1.7 billion euros.
After yield cuts, shares in Popular´s stock fell five points and slipped from the fifth position that it had kept within the First Division of the Spanish deposits market.
Edited and Translated in English by Brandon Dyches and Jose L. De Haro