MADRID, June 23 (Reuters) - Spain's competition watchdog urged political parties to give this institution better tools to look into potential anticompetitive practices between banks when setting deposit rates for savers, its chair Cani Fernandez said on Friday. Spanish banks offer the lowest household deposit rates among the euro zone's large economies, igniting demands from the government, supervisors and clients to pass on higher interest rates for savers. "A tacit collusion is a hole in our system of tools to tackle (this issue) in markets with little competition," Fernandez said. She added that other European countries, such as Germany and the UK, had better tools to look into these commercial practices. On Friday, the Bank of Spain Governor Pablo Hernandez de Cos said it was up to the CNMC to look into that matter.

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Persons: Cani Fernandez, Fernandez, smartly, Pablo Hernandez de Cos, Jesús Aguado, Emma Pinedo, Kirsten Donovan, Louise Heavens Organizations: Bank of Spain, Thomson Locations: MADRID, Spanish, Santander, Germany