The closure of bank branches has been accompanied by a tightening of credit

The closing of bank offices that began a decade ago with the concentration of savings banks that were transformed into banks has accelerated in the past year. The Region had lost 159 branches in 2021as stated in the latest Financial Observatory prepared by Icref and the Chair of Competitiveness of the UMU.

In the region there four municipalities without any bank offices (AlbudeiteOjós, Ulea and Villanueva), although given the large size of the municipal terms and the existence of hundreds of nuclei scattered in the towns with more territory, the number of towns that suffer from banking exclusion is much higher. The withdrawal of banking institutions has been accompanied by a 15% drop in credit granted, while deposits fell by about 1,300 euros per person.

The report states that “the concentration of financial institutions in the search for greater size, solvency and profitability, helped by digitization, is causing a financial exclusion in the Region of Murcia».

It warns that the closures have led to “the disappearance of offices in less populated places and with lower per capita income, which causes geographical financial exclusion whose problem is accentuated by occurring in places with less capacity for economic development and with worse communications. ». Only the municipality of Murcia has lost 38 offices, while in Cartagena They have closed 17.

At the same time that the number of bank branches was reduced, which has gone from 702 in 2020 to 543, in December of last year, “the criteria for granting loans have been tightened, which represents a change in trend with respect to the two preceding quarters, in which the criteria had remained unchanged’.

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With the increase in consumption, deposits per person have dropped by 1,300 euros, according to the latest Financial Observatory

According to the Observatory, “this contraction in the credit supply has not translated into changes in the proportion of totally denied applications, which has not changed in the final stretch of the year.”

However, after two consecutive quarters of increases, “financial institutions indicate that there has been a stagnation in business demand during the last quarter of the year 2021. The banks consider that this decrease in credit supply and demand “is punctual, since for the first quarter of 2022 they expected increases in credit demand and stability in loan approval criteria.”

However, the authors express their reservations about the possibility of these expectations materializing “in an environment of growing uncertainty and economic deterioration due to the conflict in Ukraine, of still unknown duration and effects, which could also be aggravated by new variants of covid -19».

Before the invasion of Ukraine generated the current perception of instability, the entities indicated that “most of the conditions applied to the loans have remained unchanged” with regard to the “amount granted, the guarantees requested and the margin requested in the loans”.

Nevertheless, the amount of credit per person has gone from 19,830 euros to 17,194 euros in the Region in the last year, while in Spain it has remained at 24,700 euros. In year-on-year terms, the average amount of loans in the Region of Murcia fell by almost 15% compared to the stability of the national average.

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The increase in spending that occurred in 2021 has translated into a drop in the average amount of deposits per inhabitant, which has suffered a reduction of around 1,300 euros and has returned to pre-pandemic levels.

The average amount of savings per inhabitant deposited in entities stood at 16,754 euros in December, 12,500 euros below the Spanish average, which increases the difference. On the contrary, in Spain the increase in deposits has been maintained, totaling 1,300 euros compared to 2020.

The Observatory also highlights that in the last decade the average amount of deposits in the Region has increased by 2,000 euros compared to the 4,000 euros that the national average has earned, which increases the difference in the saving capacity of the Region with regarding Spain.