Iberian banking sector sees increased competition following ECB rate shifts

The Iberian banking sector is experiencing increased competition and growth following interest rate adjustments by the European Central Bank (ECB). Digital banks like Trade Republic and Revolut are leading the market with remunerated accounts offering rates above 3% TAE.

In response, major traditional institutions such as Santander and BBVA are enhancing their deposit offers to retain savers. Santander has introduced specialized offers reaching up to 2.75% TAE for specific client profiles, while its digital subsidiary, Openbank, offers 2.75% TAE with lower entry requirements. BBVA is also providing personalized deposit rates around 2.5% TAE.

Financial analysis from JB Capital suggests a positive outlook for the Spanish and Portuguese banking sectors, forecasting improved profitability (RoTE) to exceed 21% by 2028. The firm anticipates that commercial activity and credit growth will act as key drivers, reducing the sector's total reliance on interest rate fluctuations. Major banks including CaixaBank and Sabadell are also noted for leveraging commercial activity to bolster record earnings.