Banks need to make money again, says Spanish expert

Banks need to make money again, Jorge Soley, senior lecturer in financial management at the IESE Business School in Spain, told Xinhua when talking about the challenges for the global financial sector.

"One of the biggest challenges is for the banks, they have to make money again,"he said, specifying that "we have to return to double-digit returns."

Other challenges are "the digitization and the fight against delays in payments (by) implementing more conservative criteria to reduce risk," the expert added.

In the Spanish case, some of the banks have already reported profits, but in other cases, there have been millions of losses, such as the case of Banco Popular which lost 3.5 billion euros (3.72 billion U.S. dollars) in 2016.

The excess of credit granted in the years prior to the crisis led to a bubble that exploded in 2008, causing a global financial crisis with very serious consequences for the productive economy.

"(Then U.S.)President (Bill) Clinton designed a policy to make it easier for people access to housing, regardless of people's income," he said, adding that the buyer of those mortgages was not being analyzed.

"They were not analyzed or asked for additional guarantees," he said.

Nevertheless, he thinks that the problem "is almost solved" as banks do not guarantee the high percentages as before and "this forces buyers to put something of their own," he said.

Soley is optimistic and believes that "it is difficult that this happens again, because everyone has lost a lot of money and everyone knows that we all were involved, banks, supervisors, appraisers and people who invested in these assets."

Soley believed that there will be no other systemic crisis like 2008. "I do not see another crisis, some banking entities will be bought by others, that might happen, but not another systemic crisis," he said. Endit