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Banking Updated: 07 Jun 2017

Ricardo Gómez Barredo: “A clear and fair regulatory framework will contribute to financial stability”

Ricardo Gómez Barredo, Director of Accounting & Supervisors at BBVA taught the Rafael Termes Lesson at the University of Navarra’s School of Economics. “A clear and fair regulatory framework will contribute to financial stability, innovation, customer protection and efficiency gains in the market,” he told the 27th class at the School of Economics and twelfth class receiving a dual degree in Law.


BBVA’s head of accounting and relations with supervisors also noted that, in an environment in which new players are joining the financial system, supervisors must ensure that the rules of the game are the same for everyone.

Ricardo Gómez Barredo stressed the need for balance in financial regulation. He did so as part of the Rafael Termes Lesson at University of Navarra, which is given to new graduates of the School of Economics and those receiving a dual degree in Law. During his presentation, he defended the need to strike a balance between over-regulation, which comes with the risk of suffocating the financial system and paralyzing lending, and the lack of regulation, which could lead to a collapse of the system, as well as excessive, uncontrolled growth.

In his presentation, Ricardo Gómez Barredo wanted to put into context the current situation of the banking industry and the challenges it faces and close with an analysis of the future of the sector. He indicated that one of the biggest challenges banks face is “transforming the financial system to smart technology systems.”

BBVA’s Director of Accounting & Supervisors began his presentation by reviewing the evolution of the financial system as it relates to society, in which it plays a decisive role. In his opinion, a solid, efficient, and profitable financial system ensures sustainable growth, facilitates the practical use of innovation, supports a series of services that are needed to develop the economy and manages risks while protecting deposits.

Ricardo Gómez Barredo maintained that as society’s demands changed, so did the banking model, leading to the creation of systemic institutions that operate in a globalized world with highly complex structures that can put at risk the financial stability of the entire system. To mitigate these effects, authorities reinforced the role of supervisors and regulators in order to protect deposits, ensure the stability of the system and avoid using taxpayers’ money.

However, this perhaps excessive regulatory pressure is having a negative impact on banks’ profitability at a time when the financial system has to face a challenging environment, Ricardo Gómez Barredo argued.

To conclude, the Director of Accounting & Supervisors reviewed the challenges facing the financial system: a complex environment, changes among consumers and their expectations, the impact of new technologies and new players joining the industry. He then explained what the future of the banking sector will look like in this environment where traditional banks will coexist with the new businesses (fintech).

In this regard, he emphasized the challenge represented by new players joining the value chain and the need for supervisors and regulators to react to this new reality, ensuring that the same rules apply to everyone. From his point of view, banks must adapt quickly to the new environment because if they don’t, it could affect the speed and magnitude of the transition.