Spain Probes 4 Banks For Antitrust Violations With COVID Loans

Spain’s competition watchdog CNMC said on Wednesday it was investigating possible anti-competitive practices in the marketing of state-backed loans by lenders Banco Sabadell, Santander, Caixabank and Bankia.

The CNMC said it had opened disciplinary proceedings against the banks over alleged irregularities involving state-backed credit lines to help companies and households cope with the impact of COVID-19.

This now opens a maximum period of 18 months for the investigation and resolution of the case by the CNMC.

The Spanish government approved last year up to 100 billion euros ($121.3 billion) in so-called ICO liquidity lines, where the state guaranteed up to 80% of the loans. They were channelled through banks mainly to small and mid-sized companies and the self-employed.

The CNMC said it was investigating whether banks had required customers to buy financial products as a precondition to receive these loans.

Sabadell and Caixabank, which as of end March legally closed the acquisition of Bankia, declined to comment.

Santander said it had complied with regulations governing the ICO loans and that it had not made ICO-guaranteed financing contingent on any product or service. It said it was awaiting further information on the details of the investigation.

The CNMC said it was also analysing whether loans were used to restructure pre-existing financial debts, it said.

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