Banking Supervision

Authorisation to create credit institutions lies, from 1 January 2013, with the Banco de España, further to a report from SEPBLAC (Executive Service of the Commission for the Prevention of Money Laundering and Monetary Offences) on the matters within its remit.

In order to grant the authorisation, a series of requirements concerning the solvency of the new entity, the suitability of its shareholders and senior officers, the professional expertise of the latter and the existence of a good administrative and accounting structure, as well as suitable internal controls are all taken into account.

Once the authorisation has been granted and the institution has been incorporated and included in the Companies Register, credit institutions must register their directors, general managers or similar officers in the Registry of Institutions and in the Senior Officers Register, both in the Banco de España.

The institution must notify the Banco de España of any important changes in their shareholder make-up. In order to ensure the suitability of shareholders with a qualifying holding, the Banco de España may oppose investments in significant cases.

Furthermore, Spanish credit institutions that intend to carry out cross-border activities by opening branches abroad or by providing services with no physical premises, must submit a prior application to the Banco de España in accordance with título II del Real Decreto 1245/1995 .

Community regulations governing banking activities apply the principles of sole licence and supervision by country of origin, whereby entities authorised by a European Union (EU) member state have what is called the “Community passport”. Nevertheless, credit institutions from other member states wishing to operate in Spain, with or without a branch, must be registered in the Banco de España's Register.

Recognition of the Community passport and supervision by country of origin results in the need to ensure a minimum guarantee level for deposits in the EU. Directive 94/19/EC therefore requires all credit institutions to be covered by a deposit guarantee system and it standardises the main elements in this system. This directive is transposed into Spanish legislation through Real Decreto 2606/1996 which requires institutions to adhere to one of the three deposit guarantee funds in Spain.

Lastly, there is an additional aspect that affects the undertaking of banking activities: the existence of a single monetary policy which, as for other credit institutions in the euro area, requires Spanish credit institutions to hold minimum liquidity reserves in the Banco de España, as established by Reglamento (CE) 1745/2003 .