pp below the ceiling reached in 2013. however, this ratio is still well above its precrisis level. foreclosed assets have fallen by 50 % from the high reached in 2011, but still amounted to nearly €40 billion in june 2019. additionally, in that period there was a strong contraction in the bank credit portfolios, which resulted from the sharp correction of the excessive debt built up by spanish households and firms in the pre - crisis years and from banks ’ loss of market share in the total financing of the economy. during those years, banks cushioned the balance sheet effect of this fall in their credit portfolios by increasing their exposure to other assets, especially through government debt purchases. as these debt securities provide lower returns than lending to households and firms, in the long run this portfolio rebalancing resulted in a fall in the average return on assets. however, when the sovereign debt crisis came to an end, the increase in value of these debt securities provided a positive, albeit short - lived, boost to profitability. this effect fades gradually once interest rates stop falling and, furthermore, in recent years banks have substantially reduced their holdings of these securities in the available - for - sale portfolio, which, since it is measured at market prices, is where these gains are recorded. on our estimates, the overall effect of these changes in asset composition – associated with the increase in non - performing loans and the decrease in the relative share of credit on balance sheets – would explain some 70 % of the decline in net interest margin in the spanish banking system between 2007 and 2018. the fall in market interest rates has also played its part in narrowing the net interest margin, since the cost of liabilities, and especially of deposits, which are the main source of funding for spanish banks, tends to be less sensitive to changes in market returns than the remuneration of assets. 9 / 29 indeed, regarding assets, the remuneration of variable - rate loans, which make up most of the stock of outstanding credit in spain, adjusts to the new market prices as the reference indices are updated ( which generally occurs with a lag of less than one year ). further, interest rate falls also pass through to new lending, which likewise gives rise to a cut in the average remuneration of assets. regarding liabilities, the zero level of interest rates has acted as a lower bound for the cost of deposits. the reason for this downward stickiness in the cost of deposits is that

the set of basic training actions in market conduct, reporting transparency, good practices, consumer information, financial education, conflict resolution and other similar areas that the banco de espana, the cnmv and other public and private institutions are developing. i would thus like to thank bbva for all its contributions over the years towards achieving this objective which, as i have said, is so important for society and its future. the organisation of this conference testifies to this. it allows us to learn from the experiences of others and, in that way, to better pursue the joint effort of raising citizens ’ financial literacy. thank you. specifically, pupils were asked to assign €6 among various present and future consumption options, with three different interest rates ( 0 %, 100 % and 150 % ) and three different time horizons ( today as opposed to a week ’ s time, today as opposed to two weeks, and one week from now as opposed to two weeks from now ). in recompense for the different options, usb memories with different capacities were used. in each class, a pupil was randomly selected to obtain, also randomly, one of the options chosen. 8 / 8