Special courts were also set up, with over 570,000 claims received to date, of which more than 250,000 are still pending resolution. You are all no doubt aware that these high litigiousness figures entail a most considerable 2/6  BIS central bankers' speeches  workload for our already overburdened legal system, as well as involving a high economic and reputational cost for financial institutions. But I would further stress that the uncertainty associated with litigiousness may ultimately restrict or raise the cost of access to credit, harming bank customers. The lack of legal certainty prevents anticipation of the costs and risks associated with a transaction, which particularly affects very long-term operations, such as mortgage loans. Unsurprisingly, banks build into prices the costs associated with such uncertainty. I believe we can concur that legal certainty is well worth protecting, given that it is to everybody’s benefit. The regulations must guarantee this certainty, which is perfectly compatible with the proper protection of bank customers. In this respect, I believe the Law on Real Estate Credit is fit for purpose, as it straddles both elements. Law on Real Estate Credit The starting point for the rules in question here is the asymmetrical position of the lender and the borrower in the contractual relationship. In that light, the Law considers that it does not suffice to provide information to and warn the customer; rather, it demands of the professional party, which dominates the relationship, even more accountability in its behaviour towards the borrower.

I say partially because there were still some restrictions on the remuneration of sight deposits and the setting of certain commissions. We had to wait until 1987 until deposittaking institutions were free to set interest rates and commissions, with such freedom becoming extensive to all credit institutions two years later. Naturally, following liberalisation, the need to regulate transparency in relation to the setting of and changes to interest rates and fees became particularly important. It was also necessary to better clarify customer rights, and to establish reporting obligations to the Banco de España. In this respect, Law 26/1988 on the discipline and intervention of credit institutions set in place the regulatory powers for establishing a transparency regime, which was implemented by a Ministerial Order dated 12 December 1989. Banco de España Circular 8/1990 on the transparency of operations and customer protection finally drew all these legal strands together. Among other aspects, this Circular included for the first time the need to publicise the famous APR, whose aim was and still is to allow customers to make a uniform comparison of return or cost among different bank offers. Also regulated was bank product advertising, the information to be included on noticeboards, the customer ombudsman and the functioning of claims services, which had already been introduced in May 1987. 1/6  BIS central bankers' speeches  Following their introduction, transparency regulations have evolved over time, in line with changes in society and the growing level of demands made of the banking sector.