"Despite the uncertainties ... our expectation is that net interest income will increase by 15-20% in 2023, assuming a 12-month euribor of 3% for the year," CEO Manuel Menendez told shareholders at the bank's annual meeting. Banks in Europe, especially retail lenders in Spain, are benefiting from higher interest rates, but recent turmoil in the market has cast doubts over the future path of rates. The European Central Bank (ECB) has raised rates by 350 basis points since July but offered no guidance for its next meeting on May 4, arguing recent market tension could upend any plan. On Thursday, Unicaja shares were up 1.7% at 1024 GMT, after losing about 15% since the beginning of the market tensions. Menendez said market volatility had been triggered by the liquidity problems experienced by some lenders, mainly in the United States, that were "totally different to the characteristics of Unicaja's business". The collapse of Silicon Valley Bank (SVB) happened after 85% of the bank's deposits were withdrawn or attempted to be withdrawn over 24 hours. While SVB had an unusually high level of corporate deposits that were not covered by federal guarantees, 76% of deposit holders at Unicaja are retail clients, usually a much more stable source of funding. On average clients of Unicaja hold a deposit of 20,000 euros ($21,800), with about 80% covered by state guarantees, Menendez said. Unicaja also ended 2022 with a liquidity coverage ratio of 284%, well above the global banking sector average of around 140% at the end of June 2022, according to the Basel Committee on Banking Supervision. Unicaja also finished with a fully-loaded core tier-1 capital ratio, the strictest measure of solvency, of 13%, above the 8.21% required by the ECB. ($1 = 0.9190 euros) (Reporting by Jesús Aguado Editing by Inti Landauro and Mark Potter)
Messaging: Reuters Messaging: jesus.aguado.reuters.com@reuters.net)) (Adds CEO quotes, detail on deposit base funding)
By Jesús Aguado
MADRID, March 30 (Reuters) - Spain's Unicaja is
sticking to its forecast for 15-20% growth in lending income
this year despite global banking sector turmoil, it said on
Thursday.
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