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  • Writer's pictureJamie Clark

Spanish banks, let's talk about savings accounts

Updated: May 7

The last years have been tough. We've experienced a global pandemic, the first war on European soil since World War II, high tension and war in the Middle East — and that is just the beginning. As a consequence of such disruption, the world has experienced extremely high levels of inflation. Inflation, in simple terms: when the price of things go up.

In environments marked by inflation, central banks typically respond by raising interest rates to curb spending and regain control over targeted inflation rates, usually aiming for 2-3%.

As depicted in the graph, mirroring the high inflation of recent years, the Euro Area Interest rate has climbed, currently resting at 4.5% as of May 1st, 2024 — a significant shift from negative rates just a few years ago. This change has not only impacted Europe but has also reverberated globally.

4.5% all the way from a negative interest rate in only a matter of a few years. That is a massive change for Europe.

Consequently, banks in Spain, which are guided by the European Central Bank, have raised interest rates for variable mortgage holders, aiming to discourage spending and temper economic activity.

Having conducted market research on what the variable home loan interest rate would be for a property valued at 200,000€ (which would be considered on the lower end of the housing market in Spain) the interest rate after the 6 month mark would be sitting at 5.79%

In previous years, when the European Bank interest rates were lower, the margins that banks were operating at closer resembled:

  • variable mortgage rate 2%

  • savings accounts offer 0% 2% profit margin

and now it looks more like:

  • 5% variable mortgage rate

  • 1% offer for savings accounts 4% margins.

There appears to be a cultural indifference in Spain towards savings accounts, despite their potential role in combating some of the economic challenges. And thus despite the hyper inflationary environment, the awareness to have a high-yielding savings accounts seem to be lacking.

And you may wonder, where is the evidence that the banks are profiting in such a dramatic way from this discrepancy? Here is the performance in terms of share price of the top Spanish banks. These graphs shows the change in share price over the past 12 months.

Investors are onto this and know that this is happening. These are some extraordinary gains in share price from the Spanish banks.

So, let's just put money into other asset classes you may now say? Well, sure. But really how accessible is the education for the wider population to feel comfortable entering the stock market, cryptocurrency, possession of gold etc. Interest savings accounts have historically been the starting point for people to feel empowered and incentivised to grow their money.

What's on offer, as of May 1st 2024

List of Banks in Spain that have HQ in Spain and have physical branches. This list does not include digital banks.


New Customer Only Policy

Savings interest rate (annual)


EU Deposit Guarantee up to 100k€

OpenBank (Santander)







1.0% or 1.5% with salary



Banco Sabadell





Yep.. That's my list. Just three options. If Caixabank, Santander, Bankinter* offer real savings accounts, let me know, because I surely can't find any evidence of it.

Bankinter* offer some savings accounts but is capped up to 10,000€.

Keep in mind, there are Neobanks such as Revolut, N26, Evobank that offer flexible savings account. But if you are one of those people that like to meet your bank teller physically to talk about your accounts, they may not be suitable for you.

Rest of Europe

Despite the European Union largely having experienced the same economic conditions, banks in other European countries have increased their interest savings accounts. In the table below you can find some examples:



Savings Interest Rate

TF Bank Tagesgeldkonto



Consorsbank Tagesgeldkonto



Livret A



Caixa Geral De Depósitos, SA



Banca Progetto



What's next?

I would advocate you to set up an appointment with your bank to explore the range of options available to you. By actively engaging with your bank and expressing your interest in better savings opportunities, over time you could potentially influence them to improve their savings account offerings.

As more individuals take similar proactive steps in Spain, it could encourage banks to prioritise enhancing savings accounts and foster healthy competition within the industry.

This collective action has the potential to benefit all customers by leading to better terms, rates, and benefits for savings accounts.

When I walk around the streets of Madrid and see the daily rises in prices, and no options for people to grow their money I think, something has got to change.


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