Madrid (Reuters) – The chairman of Spain’s Santander (SAN.MC), Ana Botin, warned on Tuesday against more regulation in the financial industry and said that in part mismanagement was to blame for the recent banking turmoil in the sector.
“The one thing I would say first is we have to do a good diagnosis, but the one thing we don’t need is more regulation,” Botin, who also heads trade body IIF, said at an event in Brussels.
Botin made those comments at a moment when the European Central Bank is considering whether requirements tailored to individual lenders could help address the risks arising for those holding large amounts of uninsured deposits, a document showed.
Asked about the market turmoil in the U.S. and Switzerland, where Silicon Valley Bank (SVB) collapsed and Credit Suisse was taken over by UBS (UBSG.S) in a state-assisted rescue, Botin said that “what happened is mismanagement.”
“Everything that you shouldn’t do was done: concentration of risk, mismatch of maturities, liquidity not enough of it, investing on government debt at 1% or less than 1%”.
“When that happens it has nothing to do with regulation, or supervision,” Botin said.
The collapse of Silicon Valley Bank after deposit withdrawals that forced the U.S. regional lender to sell Treasury bonds at a loss has focused investors’ attention on the potential losses banks face on their government bond holdings.
The ECB has recently said it is actively working with other global supervisors to understand which lessons could be learnt as attention is shifting to liquidity and funding risks.
Botin however said on Tuesday that “this is not 2008, if we look at regulated banking sector we’ve gone from two to six trillion in capital so the regulated banking sector and the systemic banks are strong.”
Image by: REUTERS/Violeta Santos Moura