PHILANTHROPIST
The Foundations
The Foundations in numbers
From the moment he joined Banco Popular, Valls approached his business activities with the conviction that their ultimate purpose was to meet the needs of society. He was convinced that a company should generate profits and economic efficiency and undertake “social commitments.”
When Luis Valls was appointed Vice President in 1957, he persuaded the rest of the board members to waive their economic rights to the entity’s profits and allocate them to social activities.
The Foundations in numbers
Initially, these bank contributions were given directly to the beneficiaries. Later, they were channelled through specialized entities and, from 1970 onwards, through foundations: the Hispanic Foundation, established in 1970, and the Foundation for Social Assistance, established in 1981.
Additionally, apart from the assistance provided by the bank, in 1987 Luis Valls promoted the creation of another foundation: Promotion of Foundations (International Foundation), which was to receive various legacies and inheritances, including those from Rafael Termes—its founder—and from Luis Valls himself.
Among the main management criteria of these foundations were minimizing management expenses, separating the funds intended for social activities from those of the bank, ensuring complete transparency coupled with the absence of any publicity, and the consistent belief in not “giving away” but instead financing through loans, and ensuring that the projects were economically viable (capable of repaying the loan). This also allowed the repayments to be used for new loans, thereby multiplying their effectiveness.
Valls maintained that all the assistance “remained as assets” because nothing was “given away”: the loans would be recovered, as indeed happened, and the funds continued to be lent out.
When Luis Valls passed away in 2006, the foundations continued their activities, and the bank continued channelling its social action through them. In 2008, an agreement was signed between the Hispanic Foundation and the Banco Popular Board, which remained in effect until the bank’s resolution on June 7, 2017. The previous agreement dated back to 1979 and was modified in 1982, as explained by Encarna Pérez in La Vanguardia (see annex).
During the more than 50 years of the Foundations’ activities, the bank contributed 543 million euros, and received other income (donations, inheritances, and legacies) amounting to 178 million euros. Of this, 208 million were allocated to donations and the partial condoning of debt and 557 million to interest-free loans.
Over the years, this policy of helping viable projects through loans allowed, with total resources of 730 million, assistance and loans totalling 765 million—even after losing 60 million with the bank’s resolution in 2017 (the bank shares held by the foundations). Another 453 million remained on the balance sheet, resulting from repayments and returns on those assets.
