Every time Mario Draghi speaks at the news conference after the European Central Bank’s (ECB) monthly monetary policy meeting, the markets hold their breath. And after he finishes, they react. In the wake of the 2008 crisis, the expectations created by the bank’s message have taken on added relevance. BBVA Research is aware of the importance of being able to gauge if the ECB’s message adequately reflects its policy and has used big data techniques to this end.
Over the past several years, the Federal Open Market Committee (FOMC) has gradually increased the federal funds interest rates both as a response to favorable economic conditions and in order to curb inflation. In a rising interest rate environment such as this, lending is affected as banks set their own interest rates according to the prime rate, which is mostly determined by the aforementioned federal funds rate.
The sweepstakes, which started in June and wraps January 2, 2019, boasts a total of $35,000 in customer prizes, which includes one $10,000 grand prize, eight $1,000 monthly prizes and 34 weekly prizes of $500. According to BBVA Compass Director of Digital Engagement, ATM & Branch Distribution, Cody Sparks, in its first year, the sweepstakes proved to be a key driver of increased mobile adoption.
Can Big Tech take the place of banks in the financial services sector? According to Francisco González in his op-ed article in today’s edition of Financial Times, while the Big Tech’s threat is widely known, digitization opportunities for some banking institutions are less evident. BBVA Group Executive Chairman is confident that “we have what it takes to redesign banking and to bring about the next stage of this industry’s evolution.”
Jaime Sáenz de Tejada is Spain’s best CFO and the best in Europe’s banking industry, according to the Extel Survey. Group BBVA has achieved excellent results in different categories in the 2018 edition of this prestigious international survey.
The new accounting regulation IFRS 9 aims to buttress financial stability against future crises. It obliges financial institutions to more faithfully reflect credit risk and calculate provisions for insolvencies following an expected loss model (versus the previous “incurred loss” model). For a majority of financial institutions, this has resulted in an increase in provisions and the subsequent impact on capital.
Black Knight, Inc.’s latest Mortgage Monitor Report indicates that taken together, rising interest rates and home prices have affected housing affordability, resulting in a more than $100 increase in monthly payment on a 30-year mortgage used to purchase a median-priced U.S. home.
BBVA has reaffirmed its leading position in sustainable finance by closing the first green loan deal with a company in the Spanish distribution sector, the Valencian cooperative Consum. The €5-million operation proves that this type of financing is not limited to major multinationals present in the capital market. Smaller enterprises also have access to it.
The European Commission has presented its proposal on developing a new class of low-risk assets in the form of sovereign bond-backed securities (SBBS). The new security, whose goal is to enhance diversification and reduce sovereign bond risk in the euro zone, was included in the European Commission’s roadmap. The plan unveiled in December 2017 aims to deepen European Economic and Monetary Union.
To celebrate the 50th anniversary of the International Capital Market Association (ICMA), BBVA took part in a conference on capital markets. What will they be like in the future? According to José Manuel González-Páramo, they will be "digital and sustainable". Digital on the strength of innovation by technologies such as blockchain, automated advice and trading algorithms; and sustainable because they will help attract "green" finance.