SPAIN’s competition watchdog has launched a probe into the country’s six biggest banks over suspicions they acted unfairly in the mortgage market, potentially depriving borrowers of cheaper home loans.
The CNMC announced on Tuesday it was investigating Santander, BBVA, CaixaBank, Sabadell, Bankinter and Unicaja over concerns they used public statements to signal their plans to one another.
Investigators are examining whether this may have enabled Spain’s financial giants to align their mortgage rate pricing rather than genuinely compete with one another.
Under Spanish and EU competition rules, coordinating market prices is prohibited because it reduces competition and can ultimately harm borrowers by limiting access to cheaper loans.
The CNMC said in a statement that it believed certain public comments made by executives at the banks constituted indications of a possible breach of Spain’s Competition Act.
The statement added: “The alleged practices would also be contrary to Article 101 of the Treaty on the Functioning of the European Union.”
The investigation stems from Spain’s so-called ‘mortgage war,’ a fierce battle between lenders over the past two years to attract customers with increasingly competitive home loan deals.
During that period, several senior banking executives publicly warned that mortgage rates had become too low and that competition was becoming unsustainable, particularly in the fixed-rate mortgage market.
Competition regulators are now examining whether those public remarks went beyond normal market commentary and instead amounted to signals that allowed rivals to anticipate each other’s pricing strategies without directly communicating.
The opening of the investigation is not an indication of any wrongdoing – it simply means the regulator believes there are sufficient grounds to formally examine whether competition rules may have been breached.
The banks will have an opportunity to respond to the allegations before any decision is made, the CNMC has said.
The regulator added the investigation could last for up to 24 months, at the end of which it will decide whether to close the case or impose sanctions.
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