Conthe, candidate for the Frob, rules out financial exclusion due to mergers: “Offices are closed in highly populated places”
The candidate proposed by the Government to preside over the Frob, Paula Conthe, believes that the new round of mergers announced in the banking sector will not lead to a worrying increase in financial concentration and rules out that it will worsen exclusion in some provinces of the country.
“The duplication of offices and closures usually occur in highly populated places, where there is a great service from the banks and would not be an aggravating factor of financial exclusion,” he explained during his first appearance in the economic affairs committee of the Congress of Deputies, where he has defended his candidacy to run the bank resolution institution.
The bank mergers fully affect the Frob, which is Bankia’s main shareholder and will hold a 16% stake in the new ‘superbank’ that results after its absorption by CaixaBank. This process will involve the closure of more than a thousand branches in the new group in an attempt to reduce its operating costs and increase its profitability.
Conthe has informed the deputies that the managers of both banks have experience in this type of operation and are aware of the sensitivities and concerns existing in some territories due to the continued closure of offices. The same has commented on the increase in bank concentration and the impact on customers, to which he has not given much importance when noting – in line with the Bank of Spain – that there is room for new mergers.
In any case, the merger and its derived effects on profitability levels benefit the Frob’s interests. As its future president has recognized, the integration has raised a 45% the value of Bankia shares and facilitates potential divestments in the bank to try to recover as much as possible of the aid injected into the financial sector since 2012.
“The participation in the new bank is more liquid and can be sold through small sales to recover as much as possible, as the United Kingdom has done with Lloyds”, explained the aspiring and current director of Resolution of the organization, daughter of the former president of the CNMV, Manuel Conthe.
Paula Conthe has set as the main objectives of the coming years for the Frob the culmination of the challenges left by the last financial crisis -mainly the sale of the stake in Bankia- and to strengthen the tools to combat future tensions in the financial sector.
This work will be carried out together with the JUR, the European mechanism in charge of the resolution of the largest entities on the European continent. 55 smaller financial groups remain under the direct supervision of the Frob.
In this sense, the official has opted to advance in the great challenge that Europe faces in financial matters: the creation of the Banking Union. To do this, it has opted to reduce regulatory distortions between countries and the creation of a European guarantee fund.