Banks stricter attitudes to granting financing seem to be one of the main reasons behind the decrease in loan funding in recent months.
The reduction is striking especially at a time when the country's economic activity is vigorous, with a strengthened consumer sector explaining an important part of overall growth.
An article in Laprensa.com.ni states: "bank lending in January was $2099.62 million. However, in June it dropped to $2040.73 million, according to an official report.
"The factors we can analyze are various. One is the tendency of the financial system to go against real economic activity in the country, which is demonstrating growth in production", said economist and ex finance minister Rene Vallecillo.
He said that the dynamism of productive activities "is not based on getting more credit from the financial system, but instead comes from investments made from producer’s and entrepreneur’s own resources."
This year, the government plans for national economic growth of 4.5%, in other words, a rate similar to that achieved in 2010 when the Gross Domestic Product (GDP) recovered after the fall of 1.5% in 2009. "
Source: laprensa.com.ni
More on this topic
April 2011
Private sector loans dropped $31 million in February.
The Central Bank of Nicaragua believes this happens because banks are much more cautions when lending.
An article in La Prensa rports that “most loans ($13 million) went to the agricultural sector, while reductions were recorded in commercial and industrial loans, as well as credit cards”.
May 2011
Between March 2010 and March 2011, the growth in portfolio’s of banks providing loans was 6.1%.
The growth of economic activity in Guatemala is one of the reasons behind the increase in loans issued by banks, which have been distributed mainly among the commercial and consumer sectors.
July 2008
Bad debts are growing and a credit boom is losing steam within the Guatemalan banking system, reflecting the nation's economic problems, according to a report by the regulator, the Bank Superintendent's Office.
The banks' bad-debt portfolio rose from 2.1 billion quetzals (US$286 million) on January 1 to 2.77 quetzals (US$374 million) on July 13, an increase of 24 percent.
November 2010
Banco Produzcamos accumulated a $ 45 million loan portfolio during its first 5 months of operation.
According to a report from the Superintendence of Banks, the banking institution, created to fund production activities, had $ 78 million in patrimony by late October.
"The manager and president of the Union of Agricultural Producers of Nicaragua, Manuel Alvarez, said that among the bank's projections is to close the year with a credit placement in excess of $46 million," reports Elnuevodiario.com.ni.
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