In the first quarter of 2018, credit granted by banking system entities grew by 5% compared to the same period in 2017, driven by consumer loans and business loans.
Figures from the Salvadoran Banking Association (Abansa), up to last March, indicate that"... most of the financing granted was oriented towards consumption, housing, commerce and manufacturing, which in some way stimulated productive activity."
The Passive Base Rate fell from 6% to 5.9%, while the Effective Rate in Dollars also fell, from 2.29% to 2.11%.
The Central Bank of Costa Rica published on the afternoon of Wednesday, April 4, after not having registered any movement the previous week, news that the Passive Base Rate fell by 0.10%, and will remain at 5.90% until next Wednesday, April 11.[GRAFICA caption = "Click to interact with graph"]
At the end of last year the banking system's loan portfolio ended up with a balance of $66,117 million, just 1.4% more than the $65,187 million reported at the end of 2016.
The Comptroller General of the Republic reported that the moderate increase is partly explained by a contraction recorded by the external sector's portfolio, as between 2016 and 2017 it dropped from $16,557 to $14,560, which is equivalent to a 12% drop.
During January in Nicaragua, the gross portfolio of the financial system totaled $5.371 billion, 14% more than in the same month in 2017, explained in part by the performance of commercial credit.
The Central Bank of Nicaragua reported that "...The sectors with the highest representation in the portfolio are commercial credit and personal loans, with both sectors accounting for 55.4 percent of the total portfolio. On the other hand, the portfolio at risk and the past due portfolio continue to register levels below the rest of the Central America, Dominican Republic and Panama (CAPARD) region."
In an environment with a complex investment climate, between 2016 and 2017, credit to the private sector in Guatemala grew by 4%, less than the 6% registered between 2015 and 2016.
Authorities at the Bank of Guatemala (Banguat) reported that the recent judicial decisions on mining and hydroelectric projects have become the main factors that explain the environment of uncertainty that is affecting the country.
Over the past year, the gross portfolio of the financial system totaled $5.323 billion, 14% more than in 2016, explained in part by the performance of commercial credit.
Regarding the activities financed, the Central Bank of Nicaragua (BCN) reported that at the end of 2017 "... commercial credit and personal loans remained the most representative, with both sectors adding up to 55.4 percent of the total portfolio. These sectors showed year-on-year growth of 10.6 and 12.1 percent, respectively."
Due to an increase in commercial credit and personal loans, the gross portfolio totaled $5.480 billion up to November 2017, 15% more than in the same month in 2016.
According to a Report on the Performance of the National Financial System, published by the Central Bank of Nicaragua in November 2017, the financial system increased its financial assets by 16%, while the credit portfolio grew by 15%, both in year-on-year terms.
If the bill being promoted by the Hernández administration is approved, the business sector will have about $340 million in bank credit.
Without disclosing further details of the bill, the authorities estimate that with the implementation of the reform, approximately $337 million per year will be made available to the agricultural sector, housing sector, tourism and MSMEs.
The year-on-year growth of bank loans for consumption and investment reported up to November is attributed to a reduction in interest rates which occurred in the last four months.
As of September of this year, the bank loan portfolio granted to the private sector registered a 5% YoY growth, well below the 13% registered in the same month in 2016.
Changes in the rules that banks follow when granting loans in dollars, an increase in interest rates and a brief but sharp devaluation suffered by the exchange rate in May are some of the reasons behind the reduction in the speed with which the credit portfolio in dollars is growing.
A law that allows companies to use their personal property as collateral to obtain production loans has now come into force.
The president of the Higher Council of Private Enterprise (COSEP), José Adán Aguerri, stated that on Thursday, October 26, 2017, the Law on Secured Transactions entered into force, which was approved by the National Assembly in October 2016.
In 2010 average household debt per household was around $3,000, and last year, just six years later, the figure exceeded $6,500.
Data compiled by Nacion.com shows that the average debt of each Costa Rican household indicated in the analysis only takes into account financing with supervised entities, meaning that it could be be omitting loans taken out for consumption through other sources of unregulated financing, such as pay day lenders and pawn shops, among others.
The 16% year-on-year growth registered in July in Nicaragua's banking credit portfolio is mainly due to an increase in loans for consumption and industrial activity.
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