Get 40% Off
⚠ Earnings Alert! Which stocks are poised to surge?
See the stocks on our ProPicks radar. These strategies gained 19.7% year-to-date.
Unlock full list

ECB could issue negative opinion on Spanish banks' tax, De Cos says

Published 26/07/2022, 19:06
Updated 26/07/2022, 20:41
© Reuters. A European Union and a Spanish flag are seen beside the Bank of Spain building in central Madrid May 28, 2010. FREUTERS/Andrea Comas

By Jesús Aguado and Corina Pons

MADRID (Reuters) -The European Central Bank (ECB) could potentially issue a negative opinion toward a recently proposed tax on banks in Spain though details were still missing, Bank of Spain Governor Pablo Hernandez de Cos said on Tuesday.

The Spanish government announced the creation of the tax earlier this month, saying the temporary tax on banks should bring in 3 billion euros in 2023-2024 that will be earmarked to help Spaniards cope with soaring inflation.

The proposal is expected to be introduced in parliament this week.

"In general in the case of other countries it is not easy to establish a tax that does not end up affecting credit, interest rates or the resilience of banks, and the opinion of the ECB ends up being negative," De Cos told a financial event when asked about the tax in Spain.

"We do not know the details. Once we know them the ECB will have to issue an opinion," said de Cos, who is also a member of the ECB's governing council.

His remarks - which referred to similar taxes in countries such as Slovenia, Slovakia, Romania, Bulgaria, Poland, Hungary, Slovenia - were in line with similar remarks made last week by ECB Vice-President Luis de Guindos.

De Guindos cautioned against any tax that risked damaging the solvency of the banking sector.

De Cos also said on Tuesday that the central bank could probably revise sightly downwards Spain's economic growth for 2022 and even more significantly for 2023.

He said this would also apply to the eurozone's economic growth outlook.

© Reuters. A European Union and a Spanish flag are seen beside the Bank of Spain building in central Madrid May 28, 2010. FREUTERS/Andrea Comas

The central banker added he did not see the Spanish economy entering a recession.

On Tuesday, the Spanish government raised its inflation forecasts for 2022 and 2023 and lowered its economic growth target for 2023.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.