The financial group G & T Continental has obtained a general license to expand the services it provides in Panama, where it plans to strengthen its corporate and private banking area.
The financial institution started operations in Panama in July 2008 under the name of Banco Financia, S.A. (BMF) and in 2009 changed its name to Banco G & T Continental (Panamá) S.A.
At the end of August of this year, the default rate in the loan portfolio of the national financial system was 2.54%, higher than the 1.21% rate recorded four years ago.
Elperiodico.com.gt reports that "...When comparing payment delays between 2013 and 2017, the segment with the highest rate is that of small companies, made up of small and medium-sized companies, which went from 3.32% to 7.92%.
A concentrated banking system with weak capital indicators faces the challenge of reducing past-due loans, which in large banks have grown from an average of 1.1% in 2013 to 2.3% this year.
From a report by Fitch Ratings:
Loan Performance Adequate but Impaired:The behavior of loans has been affected in the last 4 years; in the second half of 2017 (2Q17), non-performing loans (arrears of greater than 90 days) for the largest banks averaged 2.3%, from 1.1% in 2013. In general, this trend was due to the fact that the default of some large creditors from different sectors affected the banking system, as well as the gradual increase in consumer loans. The temporarily established credit card law, which limited interest rates and collection practices in 2016, did not have an immediate impact. Current indicators are adequate.
Details of the draft law with which the Bank of Guatemala aims to improve regulation and supervision of the financial system.
From a statement issued by the Bank of Guatemala:
The bill submitted by the Monetary Board of the Executive Agency and by the President of the Republic to the Congress of the Republic on September 12 2016, introduces necessary reforms to Decree No.
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.
Fitch Ratings notes that the Guatemalan banking system reports one of the lowest rates of delinquency in the region.
From the report 'Panorama of Guatemalan Banks' by Fitch Ratings:
Local Majority Banking System: The largest banks (70% of loans in the system) belong to local shareholders. At the same time, foreign-owned banks increased their share after Bancolombia acquired the controlling stake in Banco Agromercantil de Guatemala, S.A. (BAM).
According to Fitch low capitalization indicators continue to reflect a structural weakness, with a potential reduction in the net interest margin and relatively high dividend payments.
From a statement issued by Fitch Central America:
Largest banks in Guatemala: Sovereign Risk Puts Pressure on Ratings
Local Majority Banking System: The largest banks (70% of loans in the system) belong to local shareholders.
With the purchase of another 20% stake, Bancolombia Group now holds 60% of the shares of the Group Agromercantil de Guatemala.
Two years after the acquisition of a 40% stake of Argomercantil Holding Group, Grupo Bancolombia has decided to consolidate its presence in the country by acquiring a further 20%. The Colombian company said the acquisition is part of a consolidation strategy in Guatemala and Central America.
Fitch Ratings predicts headwinds and higher risks for banks in Central American countries in 2016, resulting in lower credit growth.
From a report by Fitch Ratings Central America:
Headwind: Central American Banking systems face greater risks in 2016. A slowdown in growth of gross domestic product (GDP) in the region and, consequently, lower credit growth is anticipated.
The criticism attracted by the latest "commercial" venture by the State Bank of Costa Rica should not stick to just the surface of the fairytale castle and pink marketing campaign, but should go to the heart of the concept of state banks, which today have degenerated into simple banking institutions with commercial privileges.
EDITORIAL
This is precisely what Sebastian Hernandez does in his lucid analysis of the launch of the new brand Banca Kristal in new branches of Banco de Costa Rica, an exclusive service for women, and one which is painted pink.
The financial group from Nicaragua has announced the acquisition of the consumer and commercial banking operations of Citi in Guatemala.
Promerica Group announces the signing of a definitive agreement for the acquisition of consumer banking and commercial banking of Citi Guatemala, subject to approval from the regulatory agencies.
Citi's consumer banking portfolio in Guatemala includes personal loans, credit cards, deposit accounts, as well as all the services of individual banks and commercial banks Banco Citibank de Guatemala SA and Cititarjetas de Guatemala Ltda.
The banks Banco de Costa Rica, Banco Nacional and the Banco Industrial de Guatemala "will have to reduce the growth rate of their loans, since their core capital levels remain modest."
From Moody's press release:
Mexico, July 21, 2015 -- Central America's leading banks will need to slow the pace of their loan growth as their core capital levels remain modest, said Moody's Investors Service in a new report.
The five largest banks account for 82% of total assets in the system, three of them focusing on the corporate credit segment and the other two on retail banking.
From the report by Fitch Ratings "Panorama of Banks and Guatemala"
Largest banks of Guatemala: Related to the Sovereign Ratings
Banking System Concentrated in Five Largest Banks: The five largest banks account for 82% of the system's assets.
It has been reported that the Spanish firm Banco Popular has abandoned the negotiations for the purchase of Citigroup's consumer banking unit in the region.
Reports published by Bloomberg.com indicate that a purchase of consumer banking operations in the region would not be aligned to the strategic plan of the Spanish Banco Popular SA, who for weeks had been holding negotiations with Citigroup.
Slow growth is projected in El Salvador, very good performance in Nicaragua, stability in Panama, more competition in Guatemala and moderate growth in Costa Rica.
From a report by Fitch Ratings entitled "2015 Perspectives: Central American Banks":
Costa Rica:
Fitch Ratings has revised the outlook for the sector from positive to stable, because the agency does not anticipate substantial improvements in respect to the previous year.
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