The chief executive of CaixaBank has warned that mortgages in Spain are likely to become more expensive in the future due to the recent rise in long-term interest rates.
Speaking on January 30, Gonzalo Gortazar said CaixaBank will not loosen its mortgage lending criteria, nor does it plan to do so.
The comments came as the bank announced a record profit of €5.891 billion, up 1.8% year on year.
While ruling out any shift in CaixaBank’s own standards, Gortazar acknowledged the broader risk in the market, despite memories of the consequences of lax lending before the 2008 financial crisis.
According to Gortazar, the key risk facing banks is insufficient return on capital, stressing that each institution must assess ‘at what price it should carry out the operations’, adding that returns are currently ‘very close to the limit’.
He has also pointed out that the average mortgage rate in Spain stands at around 2.4%, compared with more than 3% across much of Europe.
Housing shortage a ‘major social problem’
Gortazar described Spain’s lack of housing as ‘a social problem’ and urged public authorities to make it easier to build new homes.
He called for more land to be released, greater regulatory stability, and stronger public-private cooperation, as well as enhanced coordination between different levels of government.
He said the property market is ‘unbalanced’, with a substantial supply deficit, recalling that the Bank of Spain has estimated the shortfall at around 700,000 homes.
‘We have to remedy it by increasing the supply,’ he said, adding that current difficulties show that ‘something is not working’ in the way the sector is organised.
Call for a national housing agreement
The CaixaBank boss argued that administrations must work together and reach a national agreement on housing, warning that the situation could become a ‘bottleneck’ for the economy in the medium term – a risk also flagged by the European Central Bank.
Gortazar welcomed the fact that the Bank of Spain is studying whether it should issue guidance to the mortgage market, including possible limits on interest rates or maximum loan terms.
