Year-Rate
1 - 4.0%
2 - 4.0%
3 - 4.5%
4 - 4.5%
5 - 5.5%
Embedded here are opinions on future interest rates, how long they believe the Spanish deposit war will continue, how much they are going to able to raise from equity markets... and possibly a guess as to how long it is going to be before reasonably priced non-mortgage credit will be flowing from this institution.
The winners when economic growth resumes will be Santander, BBVA and most of the other pre-restructuring banks, CaixaBank, the Basque cajas, Unicaja and its underlings and possibly Banca Civica - which may not be totally healthy, but at least has a marketing plan that breaks with the past.
Places like the subject of this post won't even exist tal cual by the time that term deposit expires.
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2 Comments:
Charles-- I thought the BdE had put an end to the practice of weak cajas offering high deposit rates. What gives?
I think the story was that any that got capital injections from FROB II would have to drop out of the deposit war. Since FROB II hasn't started yet and these guys weren't planning on applying anyway...
That might be why they're trying to lock in the money for five years without the grief of trying to sell a 5y CD, though.
Good point.
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