From December 31, 2011 to August 2 2012, INR declined by nearly $29 million, which represents 5.1% of the total.
According to an article in Tiempo.hn "The mainstay of foreign exchange is still remittances sent by around one million Hondurans who live mainly in the United States and other European countries like Spain. The amount in remittances is larger than other currency generators such as the export of products.
Banks in Guatemala will have to increase their capital from 10% to 14% when granting loans in U.S. dollars to people with incomes in quetzales.
Banking Superintendent Edgar Barquín explained that the measure, which affects a third of the entire loan portfolio in dollars -$982 million-, will force banks in the system to increase their capital in $48 million.
With the backing of the Financial System Superintendent, the Central Reserve Bank began to release half of the additional reserve of $290 million.
Due to the celebration of the recent presidential elections, an additional reserve of 3% had been established, with the anticipation of money withdrawals and capital flight.
Laprensagrafica.com reported statements by Armando Arias, president of the Salvadoran Banking Association: "They are already in the process of receiving this money. What we're doing is increasing the availability to provide more liquidity to finance the productive sectors."
The new provisions for calculating Capital Adequacy Ratio will be coming into force in Panamanian banks on April 1.
Assets that under the current rules were weighted at 100%, with the change will be weighted at 125% and 150%.
The general manager of Equilibrium risk rating, Ernesto Bazán, stated in an article in Prensa.com: "This means that assets, as measured by their risk will be higher and, therefore, the capital adequacy ratio of the Panamanian banking system will be reduced globally. It is currently at 14.3% and it could drop to 13.8% or less with the change."
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.
The Central Bank of Honduras is pressuring bankers to enlarge their credit portfolios, but banks are resisting any change to their risk policies.
In statements in La Tribuna, the well-known banker, Jorge Bueso Arias, insisted that "it is not that [the Central Bank] wants to put forth mandates, but rather... it wants that we increase our credit portfolio, and I have said publicly that our main responsibility is to our depositors,... and we cannot begin to 'to lend senselessly' to anyone that comes in requesting credit without taking the measures that banking prudence implies...”
Tomorrow the Superintendence of Banks (SIB) will request that the Monetary Board approve a modification of the Regulations for Credit Risk Management.
Even though bank portfolios in arrears are not at a critical level, the SIB will request that the Monetary Board make the changes to the rules in order for banks to increase their reserves for bad debts (loans).
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