Nine of the eleven private banks operating in the market generated fewer profits in 2010 than in 2009.
The data published by the Superintendence of Financial Institutions (SUGEF), dos not provide information on Bansol, which began operations in November 2010.
"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."
In the first six months of 2010 profits totalled $169 million, 3.6% below the total recorded in the same period of 2009.
According to statistics from the Guatemalan banking regulator (SIB), which will publish its report next Friday, profits in the first six months of 2009 were $175.1 million.
The banks that reported the largest profits for the first half of 2010 were Industrial with $46.5 million, followed by Banrural with $42.5 million and G&T Continental with 27.2 million," reports Prensalibre.com.
In 2009, banks in the country had net earnings of $190,32 million, 34% less than in 2008.
Data from banking superintendent SUGEF shows that state-owned banks fared worse than privately-owned ones. The first suffered from a 37% reduction in earnings, while the latter 28%.
"Almost all the banks earned less. The only one earning more was Citi", reported Elfinancierocr.com.
From January to November 2009, earnings at state banks reached $125 million, 28.4% less than the same period of 2008.
Banks blame the economic crisis, which caused a sharp contraction in credit.
"Data from the Banking Superintendence (Sugef), also points to other factors, like increased administrative expenses, and in some cases, less earnings for services", reported Prensalibre.cr.
Salvadoran banks made a profit of $43.6 million in the first 9 months of the year, $75 million less than the same period 2008.
All the banks in the system fared worse than last year, with the exception of Banco Azteca and Citibank.
"Credit was down 9%, as there were less loans granted to the private sector", reported Elsalvador.com. "In September 2008, the loan portfolio summed $9.1 billion, but in the same date of 2009 it had dropped to $8.3 billion".
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.
At the end of the first quarter of this year, profits were $32 million, 39.1% less than during the same period last year.
This is the first time in the last ten years that the Honduran banking system has registered a decrease in profits.
Journalist Luis Rodriguez wrote on the El Heraldo website: "The institutions that closed their balance sheets in the red were international banks such as HSBC (-59.8 million Lempiras, $3.17 million) Bancovelo (-3.4 million Lempiras, $180 thousand) and ProCredit (-29.5 million Lempiras, $1.56 million). The remaining 14 banks reported profits, but lower than those observed in the first quarter of 2008.
In the first quarter of 2009, banks registered $201.1 million in profits, $99.8 million less than during the same period in 2008.
In February of this year, the profits of Panamanian banks were $26 million. However, while earnings rose to $86.2 million in March, they were 36.6% less than those obtained during the same month in 2008.
Additionally, according to an article in Prensa.com, “income from interest fell 7.3%, and the 'other income' line, which was relevant for the sector’s good performance last year, fell by 13% during the quarter."
In March 2009, the banks from the financial system recorded profits of $22 million, compared to $34.9 million for the same period last year.
Of the banks, Agricultural Bank was the one that registered the highest profits.
José Luis Henríquez Elsalvador.com wrote: "It is anticipated that with the loans contracted by the Government with multilateral organizations and the release of contingency reserves that the SSF forced banks to establish, interest rates will begin to go down gradually. Financial statements from newspapers also indicate that banks had a loan portfolio of $8.697 billion, lower than the $8.895 billion recorded by the Superintendent in March 2008."
In the first quarter of 2009 state bank profits fell by 25% when compared to the same period in 2008.
According to the Superintendent of Financial Institutions (SUGEF), the opposite happened with private banks, which increased their profits by 12% over the same period.
Patricia Leitón reported statements by Guillermo Quesada, Bancrédito manager, in her article in Nacion.com: "The results for state banks were influenced by an increase in administrative costs, particularly due to increased spending on staff. In state banks, real spending on personnel rose by 4.7% during this period and it fell by 5.4% in private banks."