Guatemala's hard times spur 24 percent growth in bad debt

Bad debts are growing and a credit boom is losing steam within the Guatemalan banking system, reflecting the nation's economic problems, according to a report by the regulator, the Bank Superintendent's Office.

Friday, July 18, 2008

The banks' bad-debt portfolio rose from 2.1 billion quetzals (US$286 million) on January 1 to 2.77 quetzals (US$374 million) on July 13, an increase of 24 percent. Over the same period, bad debt as a proportion of the total credit portfolio rose from 2.5 percent to 3.1 percent.
Credit to the private sector, which had been growing at about 30 percent a year, slowed to only 4 percent in the first half of 2008. Antonieta de Bonilla, president of the Bank of Guatemala, said banks were running out of resources and will need fresh capital if the growth in credit is to be maintained.

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Banks in El Salvador under pressure from bad debts

July 2008

El Salvador's banks have had to increase their provision for bad debt by 15.2 percent, according to the latest report from the El Salvador Bankers' Association (ABANSA).

In May alone, the bad-debt portfolio grew by 4 percent, and the increase over the last year has been 25 percent.

Irrecoverable Receivables Grow 37% in El Salvador

March 2009

From January 2008 to January 2009, the banking system’s unrecoverable portfolio grew by 36.9%.

The portfolio with the riskiest loans, known as "E" and classified as "irrecoverable," reached $246 million in January 2009, while $179.7 million were recorded in January 2008, a variation of $66.3 million.

Credit Supply Stagnant in El Salvador

June 2011

Since the fourth quarter of 2008, credit extended by banks has been declining consistently.

An analysis published by the Salvadoran Foundation for Economic and Social Development reads:

“This decline has various interpretations, from suggestions that it is the result of reduced demand due to the lack of investment opportunities, to the internationalized banking system’s lack of identification with the needs of local businesses. Regarding the first scenario, this is a very limited conclusion and the second case offers an interpretation that doesn’t have an economic foundation.

Panama: Defaults Increase in the Banking Credit System

February 2009

In the month of June of 2008, past due accounts and defaults represented 2.4% of the credit accounts receivable; in September, 2.7%; and in December, 3.4%. publishes in its website: "Commercial banks should maintain defaults under control and make other provisions to assure stability."

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