Luis Valls, banking and social issues

Luis Valls, banking and social issues

 

He was the president of the most profitable bank in the world, and yet he believed that financial institutions have the obligation to support projects with little or no profitability. He understood that circumstances make it so that someone has more money than they need while another does not, and for this reason he created a network of foundations that provided “soft loans”, an idea thanks to which students – among others, 1,780 from the University of Navarra -, entrepreneurs and social initiatives that seemed unviable were able to get ahead. Nineteen years after his death, his figure has once again made headlines. Professor Pablo Pérez López, a scholar of the life of Valls, asks in this profile who this atypical banker really was.

Text: Pablo Pérez López, professor of Contemporary History at the University of Navarra and member of the Editorial Board of Nuestro Tiempo.

Luis Valls Taberner, born in Barcelona in 1926, grew up in a Catalan bourgeois family marked by entrepreneurship, intellectual interests, and Catholic values. His father, Fernando Valls I Taberner, was a prominent legal historian, regionalist politician, and university professor. The family faced difficult times during the Spanish Civil War when they went into exile in Rome, where Fernando taught history to Prince Juan of Bourbon—upon returning to Spain and experiencing the loss of his father in 1942, the eldest brother, Félix, assumed the role of head of the family.

Like his father, Luis decided to study law at the University of Barcelona. While pursuing his degree, through mutual friends—one of whom owned a BMW motorcycle admired by the entire group—he met a group of young people who gathered to pray. There, he discovered Opus Dei and, before long, understood that God was calling him to dedicate his life to this path. He did so at the age of twenty-one in 1946.

After completing his studies in 1949, he became an assistant professor of Political Economy and later embarked on a doctoral thesis. He moved to Madrid, where he worked in the publications department of the newly established Spanish National Research Council (CSIC), an institution his father had led in Barcelona. Everything indicated that he was following in his father’s footsteps.

However, one event led him to reconsider his plans. In January 1950, he traveled to Rome. It is easy to imagine the flood of memories and emotions this trip must have evoked. He stayed at Villa Tevere, Opus Dei’s headquarters, which was still under construction. He met the founder, Josemaría Escrivá de Balaguer, and a group of young men studying theology there. Many of them would go on to become priests of the institution.

Luis Valls was deeply moved by the financial struggles faced by the founder and his closest collaborators, especially Álvaro del Portillo. Del Portillo was primarily responsible for securing loans to fund the construction projects, which had to be paid weekly—leading to constant financial strain. Valls was internally troubled by this situation. He did not believe it was right for “the Father” (as Escrivá was affectionately called) to be burdened with the financial worries of renovating buildings and supporting the studies of young graduates. He decided that he would relieve Escrivá of this burden to the best of his ability. This decision, which he often mentioned in his correspondence, profoundly impacted his life. For example, on July 16, 1955, he wrote to Álvaro del Portillo: “Don’t forget to tell Mariano [Josemaría Escrivá] that I live with the hope of being able to take a weight off his shoulders.”

One of the first consequences of this resolution was a shift in his professional trajectory. 1951, after defending his doctoral thesis, he abandoned his plans to become a university professor and began seeking ways to enter the financial world. When reflecting on this pivotal moment in his life—such as in a 1977 interview on Spanish television—he said that he weighed which was more decisive in driving change in the world: knowledge or money, academia or banking. He decided that finance was the most fundamental and unavoidable support for any human endeavor, and he chose it as his profession to “apply the theoretical knowledge of Political Economy.”

His archive’s personal records and correspondence allow us to add more details. After his encounter in Rome, Luis Valls dedicated significant time and effort to raising funds to support the formation of Opus Dei priests at Villa Tevere alongside the founder and other institutional needs, such as establishing student residences and training centers. He sought financial support from his family, acquaintances, friends, banks, and public institutions. He achieved some successes but primarily encountered failures. Through this experience, he learned what it meant to have promising projects but lack the necessary financial resources to carry them out.

Alongside his professional work at CSIC and his fundraising efforts for Opus Dei, Valls had other responsibilities within the institution. Since 1951, he had been a member of Opus Dei’s General Council—its governing body—where he was responsible for organizing the Christian formation of married men.

Amid his many activities, he took an especially bold initiative for a 25-year-old: he wanted to buy a bank. Of course, he had no personal savings, but he sought help from his wealthy family, who supported his entrepreneurial drive. He secured a family loan of eleven million pesetas and attempted—without success—to acquire several savings banks, which he found attractive due to their strong social orientation. He also tried to buy Banco Atlántico, but its owners asked for fourteen million pesetas, and negotiations ultimately fell through.

His family had connections in the financial sector, as two of his uncles were prominent bankers. One of them, Félix Millet i Maristany, was the president of Banco Popular Español—a medium-sized bank. Seeing his nephew’s lack of success despite his talents, he offered to sell him his stake in the bank. Millet preferred to focus on the insurance business, which interested him more.

Thus, in 1953, Luis Valls entered Banco Popular not just as an employee but as a shareholder and board member. This was the beginning of a remarkable career. He worked diligently, earned the board’s trust, and ensured that individuals he trusted became part of the institution. His brother Javier eventually became co-president alongside him, and two other brothers, Pedro and Félix, also worked at the bank. His goal was twofold: first, to ensure that the bank was well-managed and increasingly profitable, and second, to shape a leadership team aligned with his vision of banking.

 

THE WORLD’S MOST PROFITABLE BANK

During his early years at Banco Popular, Luis Valls continued seeking funds to support Opus Dei’s activities. He soon realized that relying solely on donations had its limits. There needed to be an added incentive for those sympathetic to these projects. This led to the idea of offering investments instead. Funds were raised while also providing returns—perhaps not the most competitive in the market, but still worthwhile.

A notable example was Esfina (Sociedad Española Anónima de Estudios Financieros), “an investment fund holding company that owned the majority of shares in various business enterprises created with essentially apostolic purposes,” as described by John F. Coverdale and J. L. González Gullón in their History of Opus Dei. Luis Valls served as Esfina’s vice president alongside other Opus Dei members, Andrés Rueda and Alberto Ullastres, who chaired the holding company. Esfina helped finance several ventures, including SARPE, the publishing house behind Nuestro Tiempo, La Actualidad Española, Telva, and other magazines. This approach was certainly an improvement over soliciting donations—transforming donors into investors.

This strategy helped Valls achieve his goal of easing the financial struggles of Escrivá and Opus Dei. Construction projects in Rome were completed, and Valls also contributed to funding student residences in various countries—such as Netherhall House in London and others in Spain—as well as the Roman College of the Holy Cross. As he gained experience, the principles defining his unique approach to banking took shape.

Luis Valls believed financial institutions provided a crucial social service, forming the foundation for business or personal ventures that required solid financial backing. Thus, he viewed the bank as responsible for serving its clients—both savers and investors—its employees and shareholders. When Valls assumed the executive vice presidency of Banco Popular in 1957 at 31, the bank grew steadily, maintaining a stable and sustainable approach. His strategy focused on commercial banking and supporting small and medium-sized enterprises.

After fifteen years of intense work—at times at the expense of his health—Valls was appointed executive chairman of Banco Popular in 1972 following the death of former chairman Fernando Camacho. During this period, the bank’s growth accelerated, making it one of Spain’s seven major financial institutions, alongside Banco Español de Crédito, Hispanoamericano, Central, Bilbao, Vizcaya, and Santander. It was the smallest among them but far from the least solvent—quite the opposite. Its profitability multiplied by 166, as Gabriell Tortella and others in History of Banco Popular explained. By 1989, IBCA, the world’s leading financial rating agency, recognized Banco Popular as the most profitable bank in the world—a distinction it maintained until 1992. In December 1990, Euromoney magazine named it the best bank in the world, and it remained at the top of the rankings until 1996.

However, for Luis Valls, what truly mattered was serving his clients, employees, and shareholders—who numbered eight million by the 1980s.

Yet, in Valls‘ view, the bank should not only engage in projects promising profitability with reasonable risk; there were also valuable initiatives that could not guarantee financial returns, and these deserved support. Drawing from his own experience, he devised a method to achieve this goal: he asked the bank’s board members to forgo their statutory allowances—compensation for serving on the board. This was no trivial sum; typically, these allowances accounted for 5% of the bank’s gross profits, distributed among board members before dividends were issued. All but one board member agreed to Valls‘ proposal—a testament to the type of people he had sought for the bank’s leadership.

The funds surrendered by the executives were placed in a special account, with its proceeds allocated to support non-commercial projects. According to Luis Valls, the money needed an extra push to reach where it could truly serve society. This marked the beginning of a series of funds that, starting in 1970, supported various foundations such as Fundación Hispánica, the University Board of Trustees, and the Foundation for the Promotion of Foundations. Some of these organizations were financially backed by Banco Popular but operated independently, while others were directly linked to Valls himself rather than the bank.
His Christian work ethic led him to view money as more than just a tool for economic transactions—it was also a means of acknowledging human dignity.

 

LUIS VALLS’ FOUNDATIONS

What were these foundations dedicated to? What was their purpose? The first principle Luis Valls established was that these institutions did not give away money. Instead, they provided loans under highly favorable conditions—known as “soft loans”—with long repayment periods and low interest rates. He believed outright donations were humiliating, placing the recipient in a position of clear inferiority to the donor. Valls rejected this notion. He saw wealth as circumstantial—some have more than they need, while others lack basic resources. But those in financial hardship retained the same dignity as those with abundance. This dignity, he believed, was recognized through the trust placed in recipients, allowing them to prove they could generate value from the capital lent to them and eventually repay it.

The second guiding principle of Fundación Hispánica, the University Board of Trustees, and the Foundation for the Promotion of Foundations was that the projects they supported could not be commercial ventures. Banking already served that purpose. These foundations, instead, addressed the needs of those who could not—or did not wish to—turn their activities into profitable enterprises.

An example illustrates this approach: Valls learned of a prisoner seeking assistance to buy a motorcycle. He aimed to start a small courier and delivery business once granted daytime release from prison. His criminal record and lack of collateral made it impossible for him to obtain a bank loan. Rather than giving him a motorcycle, the foundations gave him a soft loan. With the profits from his business, he repaid the loan. Once free, he sought another loan to buy a van and expand his business. Again, he repaid it—demonstrating his ability to manage his enterprise and leave behind criminal activity. Luis Valls aimed for this impact by leveraging his business success beyond profit.

These three foundations have financed—and continue to fund—countless initiatives, many linked to Opus Dei’s apostolic work. These include university residences, cultural centers, spiritual retreats, and library development. One notable example was the Créditos a la Excelencia Académica program at the University of Navarra. Between 2009 and 2017, 1,780 high-achieving high school graduates received special soft loans to fund their university education. If they achieved grades above certain thresholds, the bank forgave 50% to 75% of their debt. Additionally, Valls‘ initiatives funded 283 students through the Alumni Scholarship Program and provided financial aid to an average of 170 priests annually for their theological studies through the International Program for Ecclesiastical Studies.
However, Valls‘ foundations also supported a wide range of organizations beyond Opus Dei, from Spain’s Communist Party (Banco Popular was the only bank to grant it credit for the 1979 elections) to convents of Poor Clare nuns in Hellín and Murcia and the Iesu Communio religious community. Other remarkable initiatives included Ciudad Escuela Muchachos in Leganés—a program for at-risk youth—Eastlands College of Technology in Nairobi, library development programs for African schools, and CITE Technical Institute in the Philippines.

Regarding Opus Dei-related projects, Valls insisted that loans be repaid like any other. Analyzing the financial records of the foundations he established reveals that Opus Dei-linked initiatives had a repayment rate exceeding 80%, compared to just over 50% for other loans.

At this point, one might wonder what drove Valls‘ principles and actions. He was not motivated by pure philanthropy or a desire to ease his own financial conscience. His austere lifestyle attested to that—his secretary, Francisco Aparicio, noted that six suits were enough for him to dress impeccably.

So, why did he view the world and finance this way? The answer is clear: he tried to live his faith as St. Josemaría taught him, seeking to sanctify all aspects of his life, particularly his professional work. He wanted to practice banking the way he believed Jesus Christ would have. Luis Valls demonstrated that one can be contemplative while looking at money. Those who cannot accept such a motivation may look for twisted explanations for these actions. They are free to do so, but I fear they will not get any closer to the truth about a life truly worthy of study.