The announcement of the closure of operations by VECA Airlines confirms the financial difficulties facing the various businesses belonging to Alba group in in the country.
The sale in November 2016 of the Schafik Handal fuel plant was one of the most recent signs of the financial difficulties facing the conglomerate Empresas ALBA in El Salvador, which has been around since 2006, involving in several businesses linked to the government.
In December 2016 the balance of the portfolio of loans granted by the financial system to private companies amounted to $5.63 billion, 7% more than in the same month in 2015.
From a report by the Superintendent of Financial System of El Salvador:
As of December 31, 2016 the balance of loans granted by banks and financial institutions grew by 5.5% compared to the same month in 2015, reaching $12,409,000.
Figures from the Financial System Regulator point out that in the same period deposits grew by 3%, reaching $11,243 million.Most noteworthy were private sector deposits, which increased by $380 million, while the public sector fell by $53 million.
Fitch foresees returns for Nicaraguan banks, however the result will not be as good for the banking industry in Panama, Guatemala or El Salvador.
From Fitch's report "2017 Outlook: Central American and Dominican Republic Banks"
The 2017 Central American bank rating outlook is stable for 2017, reflecting slight changes in growth and financial performance, according to a new Fitch Ratings report. The evolution of some factors, such as interest rates and private investment, or the emergence of events that could increase reputation risk could alter the banking outlook.Stable Rating Outlook: The ratings of most banks in the region have a stable outlook, reflecting the fact that their credit profile will not undergo significant changes in Fitch's base scenario.Movements in the ratings will be derived mainly from adjustments in ratings of parent banks or sovereign ratings, or of unanticipated events.
Finally, the Legislature has approved a loan from the French government which is part of the funding required to renovate the water treatment plant in Las Pavas, La Libertad.
From a statement issued by the Legislative Assembly of El Salvador:
Following the ratification of the loan agreement between the Government of El Salvador and NATIXIS (Department of Institutional Activities), in the French Republic, with which the water supply in the Metropolitan Area of San Salvador will be guaranteed, deputies have pointed out the benefits which will arise from the renovation of the water treatment plant in Las Pavas for the inhabitants of the greater San Salvador area and thanked the French ambassador to the country, David Izzo, for the interest shown over the approval and ratification of the loan.
The Autonomous Executive Port Commission plans to issue debt in 2017 worth another $68 million, to finance the expansion works of the Comalapa terminal.
This will be the third issue of debt bonds to finance the airport's expansion project.The first was in 2013, in the amount of $58 million, and the second, for $19 million, took place in October 2015.Laprensagrafica.com reports that "...To date CEPA has only reported that using some of these resources, four new waiting rooms, which are expected to be built in the terminal, will be paid for."
Unions are opposed to the legal reform which aims to extend the scope of the supervision of the Superintendent of Financial System over savings and loans cooperatives.
In the view of Julio Cesar Portillo, secretary of the board of the National Commission for credit unions in El Salvador and CEO of Co-Andes de R.L. ,"... the reform presented to the Legislature, seeks to impose on savings and loans cooperatives a framework of regulation and supervision which is exclusively for private financial companies and for-profit institutions such as banks. "
Moody's warns of the risks faced by banks in Central America in the context of a rising trend in interest rates and dollarization of their loan portfolios.
From a report by Moody's:
Mexico, September 14, 2016 -- Banks in Central America face rising asset risks as interest rates look set to rise in the region, pushing up debt service costs for borrowers, according to a report from Moody's Investors Service.
On October 3rd and 4th companies in Guatemala in the microfinance sector and other countries will meet to discuss the future of the sector and the new law.
The Chamber of Microfinancers in Guatemala will be holding the Second Congress on Microfinance in Guatemala, on October 3 and 4 2016, which will be held at the Intercontinental Real Hotel.
On October 12 and 13 representatives from the banking and financial sector will be gathering together in Panama City to discuss issues relating to regulation, business and investment.
The International Finance Summit is an event being organized by the Banking Association of Panama and will be held at the Hotel Trump Ocean Club Convention Center.
The Central Bank is preparing a draft law establishing a legal framework for factoring services.
Up until now factoring in the country has been governed only by the provisions of the Commercial Code, which falls short when regulating this funding mechanism, which is widely used particularly by SMEs.
Optimal Financial Services has acquired the financial operations of Finca El Salvador for $12 million.
With the purchase of Finca, the company Optima will be managing total assets of $40 million and a portfolio of 14,000 customers."...The operations of Finca will become part of Optima's portfolio of financial products and services, incorporating individual loans of up to $300, and express credit up to $1,000, within 24 hours for small business. "
Ignorance and distrust on the part of the users is preventing mobile applications from being used more to carrying out financial transactions in the country.
From a statement issued by the Central Bank of El Salvador:
The Central Bank reported results from the "National Survey of Access to Financial Services in El Salvador", on this day, July 1.
After the bank was taken over because of its inclusion in the Clinton List drawn up by the U.S. Treasury Department, the Superintendency of Banks has ordered its reorganization and sale to another bank.
From a statement issued by the Superintendency of Banks in Panama:
O4Bi is a system that allows to control and manage what a company needs: the complete process of development of works, accounts receivable, treasury, banks, sales and accounting.
O4Bi is a very robust system that allows to control and...
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