were unwilling to reduce it below zero. therefore, banks have been reluctant to increase the remuneration of retail deposits until the margin between market and deposit rates has returned to more normal levels. additionally, the current ample liquidity available to commercial banks reduces the pressure on them to increase the remuneration of retail deposits. 14 it should be noted, however, that a slower pass - through this result, ho wever, masks a significant degree o f hetero geneity acro ss co untries : th e share o f ho useho ld debt with interest rates that reset within a year stands at 76 % in italy and 71 % in spain, but just 9 % in france and 11 % in germany. in spite o f the sluggish respo nse o f the remuneratio n o f retail depo sits, the pass - thro ugh o f market rates to retail lending rates in the euro area has been similar to in the past fo r mo rtgages, whereas in the case o f lo ans to non - financial co rpo ratio ns it has been mo derately faster, acco rding to banco de espana staff analysis. to deposit rates may also have dampening effects on household spending, by slowing down the increase in savers ’ financial income. on the other hand, certain factors point to a potential faster monetary policy transmission compared to past episodes. first, the current hiking cycle comes after the negative shock prompted by the pandemic, which adversely impacted the financial situation of firms by increasing their debt levels. this leaves them more vulnerable to interest hikes rates and their expenditure decisions may be more sensitive to monetary policy changes. second, there is some evidence that monetary policy tightening is now impacting firms ’ financing conditions more forcibly than in the past. in particular, there has been a shift from bank to bond funding in the last decade, with bond debt increasing from 16 % to 24 % of non - financial corporations ’ total debt. the faster policy pass - through to bond rates than to bank rates implies faster transmission. moreover, loan origination is contracting rapidly judging by the short lag from the first rate hike. the evidence available shows a strong econometric relationship between bank lending survey ( bls ) credit standards and a so - called credit impulse a couple of quarters later, and likewise between the credit impulse and gdp growth. 15 the first link in the chain – between the bls and the

17. 1 % year - on - year due to the uneven passthrough of higher interest rates to loans and deposits. in the european comparison, the main spanish banks stood out for their strong net interest income ( above the 75th percentile in the country distribution ) and for fee and commission income and operating expenses in line with the european median. - impairment losses rose considerably in 2022, driven by higher provisions in banks ’ business abroad. in spain, impairment loses continued along the downward path of recent years, decreasing by 20. 7 % in 2022. as a result, the ratio of impairment losses to operating income in spain stood at one of its lowest levels in recent years. - return on equity ( roe ) excluding extraordinary items was 10. 2 % in 2022, 140 bp higher than in 2021 and up almost 300 bp on its 2019 level ( and therefore higher than the cost of equity ). - ordinary profit from business abroad rose significantly, driven by the strength of the business in latin america. thus, the ordinary profit obtained by the spanish institutions with the most international activity exceeded prepandemic levels. - revenue from the windfall tax on banking sector profits in 2023 is expected to amount to 5 % of the 2022 net consolidated profit. - dividend payments exceeded €7. 2 billion in 2022, with a payout ratio of 40 %, similar to before the pandemic. the rise in the profit ratio per share and the sharp increase in share buy - backs made by some banks also stand out, the aim being to subsequently cancel the repurchased shares and reduce share capital, thus providing additional remuneration for shareholders. banking sector solvency - the cet1 ratio decreased by 25 bp in 2022 with respect to 2021, albeit holding above pre - pandemic levels. the decline in 2022 was on account of the growth in total assets ( 2. 6 % ) and the increase in risk - weighted asset ( rwa ) density ( 53 bp ), which could not be offset by the 2. 1 % rise in cet1 capital. - the change in cet1 ratios in 2022 was also uneven across banks. the three largest banks, which at december 2022 accounted for 76 % of rwas, saw their ( rwa - weighted ) average cet1 ratio fall by 33 bp, 5 while at other banks it increased by 8 bp. - spanish banks ’ cet1 ratios remain at the low