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RESEARCH PRODUCT

Banking in Spain

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This chapter aims to explore recent developments in the Spanish banking industry and the measures adopted in recent years to correct the imbalances that built up during the expansion, in order to give an up-to-date picture of the sector in the international context. To this end, the chapter is divided into four sections. The section following the Introduction examines the importance of the banking sector in the Spanish economy using various indicators of banking penetration. The next section, “Characteristics of the Spanish Banking Sector: Recent Trends”, looks at key features of the banking sector and its evolution in terms of a range of measures, including margins, profitability, efficiency, solvency, specialization and market concentration. The section “Crisis and Restructuring: From the 2012 Bailout to Passing the Stress Tests in 2014” describes the imbalances that built up during the expansion, which lasted until 2008, and which provided the rationale for the subsequent restructuring, analysing the main measures taken and the restructuring’s outcome. Finally, to conclude, the section “Lessons of the Banking Crisis and Future Challenges” sets out the lessons of the banking crisis and the challenges the Spanish banking sector faces going forward.