Court of European Union orders to Spanish banks to return more than US$ 4000 million by clauses in mortgage – Diary Management

This sentence will damage the balance sheets of some entities already affected by low interest rates, which are weighing on its margins, and could spark further mergers to search for cost savings.

Bankinter is saved from the downturn in the bag, as you never introduced the clauses in question. (Photo: Reuters).

Reuters.- The Court of Justice of the European Union on Wednesday ordered Spanish banks to return to their customers all the capital unduly charged in a highly controversial clauses mortgage, which could lead to the entities to pay up to 4,000 million euros (US$ 4,200 million).

The unexpected failure dealt a serious setback to Spanish banks, which must pay now more than recognized originally the Spanish Supreme Court, which set may 2013 as the date from which they had to compensate the customers if the so-called "clauses" floor had not been explained with transparency.

The mortgages had an interest rate could not fall below the reference, which meant that the customers suffer losses due to the lower cost of borrowing when rates were cut below this level.

"The case-law of the Spanish limit in time the effects of the declaration of nullity of the clauses ground contained in the contracts of mortgage loan in Spain is incompatible with the Law of the Union," he said in a statement the court, whose ruling no appeal.

Although it is necessary to be declared abusive "clause soil" before the bank has to return the amount paid unduly, until now, the opinions of justice have given the reason to the mortgaged overwhelming way.

This sentence will damage the balance sheets of some entities already affected by low interest rates, which are weighing on its margins, and could spark further mergers to search for cost savings.

most of The banks you have already removed these clauses, or at least has made provisions of about 5,000 million euros to cover possible compensation. The new court ruling would force the banks to provision 4,000 million euros, according to calculations of the Bank of Spain, said a source knowledgeable of the same.

"The financial system is solvent, able to cope with the consequences of this judgement", said to journalists the minister of Economy, Luis de Guindos, referring to the process of strengthening their balance sheets that they have carried out the Spanish banks in recent years.

The Spanish banking sector fell in the block in the bag after the judgment, unless Bankinter, which was never introduced these clauses. The entities most exposed – Banco Popular, Sabadell and Caixabank – fell between 0.8% and 6%. Outside of the index benchmark Ibex, Liberbank lost 13%.

For its part, Santander, BBVA and Bankia were left to be 0.4%, 1% and 0.9%, respectively. Sabadell and Popular-could face an impact of around 700 million each.