BBVA, Santander and La Caixa said yesterday that they will not struggle to provide capital requirements and provisions that Spanish financial reforms require. In after hours, other lenders, encouraged by the Bank of Spain, were also sticking to their original calculations and will not need aid from outside sources.
The conclusion is that among La Caixa, Santander, BBVA, Sabadell, Popular, Bankinter, Unicaja and Kutxabank, none of them will struggle to meet requirements laid out by the reforms and will be able to comply throughout 2012 without having to ask for aid nor vary their strategic objectives.
As a group, these banks have not asked the Frob for preferentials or subscription capital, have gathered 25.051 billion euros. This amount is half of what De Guindos estimated that the entire banking system will need in order to become healthy.
Santander, of which Banesto is a part, will demand some 6.1 billion euros extra. With this figure, its capital reserves requirement ascends to 2 billion euros and is already covered with the current level. Another 1.8 billion in real estate provisions have already been covered in 2011, and another 2.3 billion should be provisioned in 2012. Because 900 million in surpluses from the sale of Santander's Colombian branch have not been counted, the bank will have to provide 1.4 billion in order to meet this demand. The bank explains that it will meet this amount with surpluses that it obtains during the course of 2012 and through funds typically reserved for this purpose.
BBVA will need 4 billion euros: 1.2 billion in capital reserves, 2.2 billion in specific provisions and 600 million in generic reserves, which now will have to be applied to cleaning up real estate assets. Financial director Manual González Cid explained yesterday that the impact on the bank?s accounts will be 1.96 billion euros, an amount that will drop to 1.36 billion by freeing up 460 million in current generic provisions and a favorable tax implication for another 140 million. The bank affirmed that this impact will be absorbed completely throughout the year. As regards the banks' capital, the extra buffer will be 0.5% of their primary capital, which is less than the results estimated for the rest of the year.
