The CNMC has announced an investigation into possible mortgage collusion. Earlier this week, the CNMC (National Commission on Markets and Competition) initiated an investigation into possible anti-competitive practices by several large Spanish banks, including Bankinter, Banco Santander, BBVA, Unicaja, CaixaBank and Sabadell. The CNMC is investigating whether certain public statements made by the executives of these banking entities constitute indications of a violation of Spanish Competition Law. These statements may have revealed the future business strategy of the banks, particularly regarding fixed mortgage interest rates, which could have allowed sector entities to anticipate the future behaviour of their competitors.
Paradoxically, the Spanish mortgage market remains the most competitive in Europe. In April, the average interest rate on own portfolio mortgages in Spain, at 2.8%, was the lowest among the major EU countries (Graph 1). Graph 2 shows how, during the last interest rate cycle, active portfolio mortgage rates in Spain increased significantly less than the 12-month Euribor (an increase of about 440 basis points in the 12-month Euribor from the start of the rate hike cycle to its peak, compared to an increase of 260 basis points in mortgage rates). This led to a significant narrowing of mortgage margins, especially in the long-term fixed rate segment. Although Spanish mortgages have a structurally low return on equity (RoTE), they remain strategically important for banks as a flagship product for customer acquisition and cross-selling. The pressures on profitability have been partly offset by complementary income (insurance, asset management) and, more importantly, through the acquisition of payroll accounts. The latter was particularly significant, as deposit margins widened considerably with the rise in interest rates.
The low profitability of deposits
A recent investigation into deposit pricing ruled in favour of the banks. Already in the summer of 2023, the CNMC investigated whether the low profitability of deposits in Spain was due to a lack of competition or to the special tax on banking entities. In fact, as shown in Graph 3, the remuneration of deposits in Spain, at about 45 bps in April 2026, is barely a little over half of the average rate in the euro area. The outcome of the investigation was favourable to the banks: the CNMC dismissed the suspicion of collusive behaviour to avoid passing on the rise in interest rates to deposits. Instead, it attributed the low deposit interest rates to structural factors, such as low customer mobility, product complexity, lack of alternatives, and low levels of financial education.
We expect a favourable outcome for the banking sector in the mortgage investigation. The investigation will have a maximum duration of 24 months. In theory, the maximum penalty that the CNMC could impose for collusive-type infringements is 10% of the total worldwide revenues of the Group. In our opinion, this is a theoretical extreme risk, rather than a likely outcome. Given the nature of the current situation, we expect a favourable outcome, where we do not foresee the investigation leading to significant fines for the sector, if any.
