In praise of banks in Spain

The posting in this blog five days ago that suggested Spanish banks were safe from the financial storms raging around the world raised some eyebrows among the so-called “experts”.

We revealed how the Bank of Spain had successful banned Spanish banks from paddling in sub prime toxic waters and how the banks were currently enjoying what we dubbed a “mañana” moment of relaxation.

Indeed, smart Banco Santander even found time to mop-up a couple of UK bargains in the shape of Alliance & Leicester and Bradford & Bingley who had fallen on hard times due to their forays into the US sub-prime market. Santander now has 25 million customers in the UK and long-time customers of Abbey – an earlier acquisition - enjoy improved customer service due to more branches, more staff and fewer “offshore” call centre confusions. The old Abbey creaking data system has been replaced by Santander’s state of the art IT.

Other media have taken up this UK versus Spain theme and some national newspapers have praised the diversification of Santander with low exposure to property loans but good general business in Spain, Britain and Latin America.

One newspaper, the Financial Times has gone further, calling on central banks to ‘take lessons from Spain’. The British newspaper thinks that the Bank of Spain’s conservative policies have contributed to the fact that the Spanish financial system can now avoid the current storm.

That’s a relief for the many British families and investors still determined to buy a property in the land of sunshine, sandy beaches, sangria – and safe banking.