Impact of the Crisis on the Banking Sector

Increased demand for credit and more requests for loan restructuring is part of what the covid-19 crisis has brought to Guatemala's banking sector.

Thursday, March 26, 2020

According to representatives of the Guatemalan Banking Association (ABG), the spread of covid-19 and the restrictive measures that have been decreed in the country are affecting the liquidity of companies, many of which have no income and must use credit to pay their bills.

See "Covid-19: Outlook for the Financial Sector"

Regarding the loan restructuring, Luis Lara Grojec, president of the ABG, explained to that "... There are already several requests from customers, a factor that is good and was logical. There are normal doubts from the clients about the terms they will have or how to make the arrangements, but the request will depend on each institution and it is something very basic."

Regarding the projections of economic growth for Guatemala at the end of 2020, the executive said that "... Before the perception of GDP growth was at 3.1% to 4.1%, but project that the economy of Guatemala could be between 1% or less. There will definitely be a negative effect on production, but it will be little compared to other countries, since here we acted very quickly."

According to reports from CentralAmericaData, the impact of the Covid-19 crisis on the financial sector in Central America is expected to be felt mainly in services related to stock brokerage and investment advice, where a drop is expected.

Coronavirus: How do the outlook for the region's banking sector change?

We prepared for our clients the report "Information System: Covid-19 and Business Outlook" which helps companies to measure the impact that the crisis will have on their activity in the coming months.

Click here to request access to this report.

More on this topic

Credit to the Private Sector: Poor Outlook

April 2020

Managers of Costa Rica's financial institutions predict that due to the health crisis the country is going through, the demand for credit from companies and families will continue to fall in the coming months.

Figures from the Central Bank of Costa Rica state that between March 2019 and the same month in 2020, the balance of money lent by public and private banks to companies and families decreased by 2.3%, from $28,559 million to $27,908 million. See full data (in Spanish).

Loans in Panama: 90-day Moratorium

April 2020

In the third debate, the National Assembly approved a bill that grants debtors a 90-day extension of time for payment of credits granted by banking, cooperative and financial institutions.

According to the law that must be sanctioned or banned by President Cortizo, once the term of the moratorium set forth in this law has expired, creditors, in common agreement with the debtor, must agree on the conditions for the unpaid debt to be prorated, to be paid within 24 months.

Panamanian Banks Give Extensions to Clients

March 2020

In response to the country's health crisis, 15 banks have granted a 90-day extension for their customers to make their personal credit card, home mortgage, vehicle and personal loans.

Until March 31st, the financial institutions that confirmed that had granted the extension to their clients are BAC Credomatic, Banco General, Banistmo, Banco Nacional, Global Bank, Multibank, St.

Banking Sector Makes Collections More Flexible

March 2020

In Guatemala, banks will grant deferrals and will wait for loans whose debtors are directly or indirectly affected by the spread of the coronavirus, specifically those that are not more than one month late on February 29.

The Guatemalan Banking Association (ABG) reported on March 21 that these decisions were made with the objective of supporting clients and users of banking services, who will be affected by the spread of covid-19.

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