"Private banks were mainly affected by the 9% drop of the dollar in 2010, as most of their assets are in that currency," reported the article in Nacion.com, "Since financial statements are done in Colones, transferring their assets from Dollars into Colones results in a lower valuation due to lost value in the price of the currency."
So far in 2009, profits at local commercial banks have dropped 21% in real terms.
From the entire national banking system, only 4 entities, all of them private banks, have reported real increases in their profits at the end of Setptember.
"There are two main reasons for this slowdown in the banking business: there is little growth in loan placement, and arrears have increased, forcing the banks to spend more in reserves", reported Elfinancierocr.com.
American Consult is a professional firm that provides fixed assets management and appraisal consulting services to private and state owned organizations
Operates in Panama, Nicaragua, Honduras, Guatemala, El Salvador and Costa Rica
Phone: (507) 390 4326 - (507) 6637 6681