As of June of this year, banks in El Salvador granted $6,121 million in loans to companies, registering an increase of almost 6% compared to the first half of 2017.
Figures from the Superintendency of the Financial System (SSF) indicate that out of every $100 in credits approved in June by banks in El Salvador, $45 was used to financecompanies.
As of December 2017, the balance of the loan portfolio for private companies amounted to $5.926 billion, 5% more than in the same month in 2016.
According to figures from the Superintendency of the Financial System, the balance of loans for companies grew by $306 million, increasing from $5.620 billion in December 2016 to $5.926 billion in the last month of 2017.
As of June, 883 correspondents in El Salvador were registered in El Salvador, with a total of $128 million in transactions.
Most of the transactions reported by correspondents, which include shops, supermarkets, pharmacies, or natural persons, correspond to credit card and collector payments.These two types of transactions alone accounted for almost 70% of the transactions reported by correspondents up to November 2016.
It has been announced that in the last quarter of the year the first short term investment fund will be open, which will require a minimum investment of $500, and will be aimed at conservative investors.
The "Profitable Open Short Term Investment Fund" will be managed by the SGB Funds, so far the only company legally authorized to operate such a fund.Two other fund management companies are waiting to receive approval from the Superintendent of the Financial System in order to start operating.
Having obtained authorization to operate from the Superintendence of the Financial System, the new bank has announced that it will start operations on July 20.
The bank will start with nine agencies in different parts of El Salvador, credit card services, online banking and 26 of its own ATMs.
Dicom, a division of Equifax, has received authorization to resume operations in the country, after having been suspended for alleged breaches several weeks ago.
From a statement issued by the Superintendent of the Financial System (SSF):
On November 18 the company Equifax Centroamérica, S.A. de C.V submitted a new application for authorization as a information agency for data relating to credit histories of individuals.
The Banking Association has confirmed that the entities will not provide the Superintendent of Financial System with information requested from them on the 100 largest depositors of each entity.
Armando Arias, president of the Salvadoran Banking Association, said in an article on Elsalvador.com that "... they will respect the secrecy provisions of the Law on Banks and will not give to the Superintendency of the Financial System (SSF) confidential information on depositors, as this entity has requested."
The proposed reforms involve, among other things, extending the scope of the law to include financial institutions which were not previously covered by it.
The proposal by the Financial System aims to apply a limit on interest rates that can be charged on loans to other entities which until now were not considered in the original law.
The interest rate that the Government of El Salvado pays for money from the Pension Funds is not more than 1.3%, while international investors are paid more than 7%.
Ricardo Soriano, Chairman of the Committee for the Defense of Workers Pension Fund of El Salvador (Comtradefop) reported that since the year 2006, the State has forced the Pension Fund Administrators (AFP) to invest the money belonging to Salvadoran workers in Pension Certificates, initially 30% and the 45% in 2012, money which has suffered a loss greater than $938 million each year.
With amounts from $5 to over $50,000, people bought 1412 shares in Banco Azul which will begin operations in 2014.
This amount makes up the $60 million needed for the start of operations by the entity which was formed last September with a capital of $20 million. Of the 1,412 shareholders 97% are natural persons and 3% are companies.
The government of El Salvador has lowered the proportion of the portfolio that the Pension Fund Administrators can invest in securities of foreign companies from 20% to 10%.
The Financial System of El Salvador (SSF by its initials in Spanish) stated recently that the Administrators of Pension Funds may not invest more than 10 % in bonds or securities of foreign companies registered in the country, despite the fact that these are the entities which allow Salvadorans to earn 6% interest through investments.
Financial operators who allow transactions to be made using mobile phones must have support capital and put a limit on the amount of transactions.
The project in consultation with the private sector was prepared jointly by the Superintendency of the Financial System (SSF) and the Central Reserve Bank (BCR).
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