The fever for Treasury bills is intensifying. The purchase of these products by individuals to obtain some return on their savings given the refusal of the large banks to pay for deposits -products for the most conservative who do not want to risk their money on the stock market- continues to rise and close May -the latest data published- has already stood at almost 15,000 million euros, a higher figure than the banks themselves have on their balance sheets. In addition, the assets of investment funds have increased by 17,000 million in the first quarter of the year and the participants, by 200,000, according to data from the National Securities Market Commission (CNMV).
Specifically, individuals -who go to the Bank of Spain to buy debt because the banks do not provide it- have increased their weight of these short-term products from 1,826 million at the end of December to 14,947 million at the end of May, in just five months. It is 20.9% of all debt of this type in circulation.
Meanwhile, the banks -which have replaced deposits with some product with Spanish and Italian debt to offer their clients- continue with just over 13,000 million, slightly below December, 19.9% of the total debt that is in the market.
For their part, foreign investors accelerate their departure from these products and already have less than 24,000 million, from 42,600 million at the end of December. They continue to be the ones with the most exposure to this type of national debt products, with 33% of the total.
The latest example of this fever occurred in the August auction of twelve-month Treasury bills, which has reduced for the first time so far this year the interest rate that investors have had to pay to 3.68 %. The great demand that occurred in that auction led to the first drop in the cost for the Treasury.
Meanwhile, the big banks continue to refuse to remunerate deposits, as requested by the Government and customers. Yes, the medium and small banks are doing it, at around 3%, but the big six have not yet entered this battle.
The reason is that banks still have excess liquidity from the ECB’s free bar and do not need to go to customers for funds. In addition, the rise in interest rates that the ECB has decided will have to be moderated at some point this year or next, so banks do not want to be tied to those deposits at the moment. The reality is that the banks have presented record profits in Spain until June.
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