Informe_Anual_Cecabank_2016_ENG

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EVOLUTION OF INTEREST RATE CURVES FOR GERMAN AND SPANISH PUBLIC DEBT (2013-2016)
Source:
In short, uncertainty about the repercussions of significant political events in
2016 such as Brexit and Trump has yet to clear, and there are already other
political happenings on the European horizon, which we will undoubtedly
focus our attention on in 2017 (elections in Holland, France, and Germany).
The central banks will continue to look to national and supranational political
authorities and continue to ask for their full involvement.
Banking business developments
In this complex setting, the amount of credit lent to the private sector conti-
nued to contract to December, placing the annual variation rate across the
financial system as a whole at -2.8 per cent, compared with -4.3 per cent
in the same period the previous year. The new funding of the retail sector
continued to grow over the whole year, but at a slower rate than registered
in 2015 and with variation according to different sectors: credit to SMEs and
households grew at a modest rate whilst consumer credit maintained strong
growth (29 per cent). Furthermore, credit granted to large companies redu-
ced by 33%, due to these companies having the more attractive option to
fund themselves with negotiable debt securities, to the detriment of banking
credit, in a context of a decrease in the relative cost of fixed income issues
which have been boosted by the expansion of the ECB share buying program-
me for corporate debt instruments.
Since the start of the year retail deposits have registered an upward trend,
reaching a 3 per cent year-on-year increase in December. Despite low inte-
rest rates for deposits, the reduced yield of alternative products and major vo-
latility on the stock markets have made this recovery possible, concentrated
on the increase in demand deposits.
GERMANY SPAIN
5.0
4.0
3.0
2.0
1.0
0.0
-1.0
3 month 6 month 1 year 2 year 3 year 4 year 5 year 6 year 7 year 8 year 9 year 10 year 15 year 20 year 25 year 30 year
GERM.
Nov 2016
GERM.
Nov 2013
SPAIN
Nov 2016
SPAIN
Nov 2013
Since the start
of the year retail
deposits have
registered an
upward trend.
Cecabank 2016 Annual Report Page 58
05 OUR BUSINESS MODEL
5.
5.