Bankers in Madrid predict that the country will still succumb to a conventional banking crisis over the next two years because of the collapse of its housing market.
In the past two weeks of turmoil, Spanish banks have appeared remarkably robust compared to their rivals in the US, the UK and continental Europe.
Santander, the biggest Spanish bank, pounced on the branches and deposits of the UK’s struggling Bradford & Bingley to add a third bank to its UK holdings and give itself “critical mass” on Britain’s high streets.
Emilio Botín, Santander’s chairman, had earlier described his bank as being “in a magnificent position compared with our competitors”, while José Luis Rodríguez Zapatero, the Spanish prime minister, was boasting in New York that Spain had “perhaps the most solid financial system in the international community”.
Spanish and foreign bankers – including Mr Botín and Francisco González, his counterpart at BBVA, the second largest listed Spanish bank – attribute the relative health of the country’s banks in the current crisis to stringent provisioning during the good years and to other risk controls.