Asset encumbrance in secured funding operations in the Spanish banking sector

Credit institutions’ access to funding is key to their survival, especially during crises, when market liquidity deteriorates. In such periods, the availability of assets that can be used as collateral could be instrumental in preserving access to finance. This article analyses the Spanish banking sector’s ability to access the secured funding market since late 2014, when the European Banking Authority’s asset encumbrance disclosure framework entered into force. The analysis shows that in Spain, as in all other European countries, asset encumbrance has been declining since 2022. With more unencumbered assets available, banks find it easier to access funding on the financial markets.