Crisis is Reflected in the Financial Sector

Since the political and economic crisis began in Nicaragua, credit placement has fallen, while delinquency and loan restructuring have increased.

Wednesday, March 27, 2019

Data from the Superintendence of Banks and Other Financial Institutions (Siboif) indicate that between April 2018 and February 2019, a period during which the political crisis in the country has deepened, the fall in the net credit portfolio was 16%.

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Economist Luis Murillo explained to that "... until there is a political agreement, both deposits and credit will continue to deteriorate until they reach a point of conflict for the banks."

Murillo added that he observes "... two very worrisome things, one is the impact it is going to have on the country's level of production, because let's remember that credit is necessary to speed up the economy, and two, that when the country's productivity drops, power is taken away from the national currency and we are approaching a devaluation."

Also see "Nicaragua: Economy Could Fall by up to 11%"

Regarding credit default, it is reported that between April 2018 and February 2019, past-due loans increased by 154%. In the case of loans in judicial collection, the amount rose by 119%, while the portfolio of restructured loans grew 117% for the period concerned.

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