The boom being seen in Guatemala’s economy is one of the main reasons explaining the rise in private sector credit, a key indicator of the state of an economy.
In Guatemala’s case, loans granted by financial entities have grown by 14% this year, driven not only by economic growth but also by the interest rate structure which favors debtors.
In this sense, its businesses who have taken advantage of this opportunity, and are asking for loans to expand their operations and make new investments.
For example, enterprises in the export sector, as well as from the energy and commerce sectors are those showing the greatest growth in terms of loans taken out this year.
Despite good performance in the banking sector, authorities are recommending that businesses remain prudent, especially if conditions in the Euro zone do not improve.
An article in prensalibre.com reports: “Víctor Mancilla, superintendent of Banking, recommends that banks be prudent in the way they use funds because of the risk of the European crisis deepening. ‘There could be a liquidity restriction on a global scale, maybe next year, although everything depends on the agreements reached by those countries’, he said.
Luis Lara, president of the Guatemalan Banking Association agreed that if the crisis in the Euro zone gets worse it will affect US banking, which offers credit lines to the national banking system.”
Source: prensalibre.com
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October 2011
At the close of July, $11 billion worth of new loans were granted, 17% higher than in the same period last year.
Among the different sectors of the economy, mining, livestock and fisheries were those receiving the most new loans.
"The biggest increase registered, in terms of percentages, was in mining and quarrying, where $15.2 million in new loans was granted, up from $12.3 million compared to figures from the same period in 2010.
February 2009
70% of the Foreign credit lines in the Guatemalan Banking System were renegotiated under new conditions.
In an article published in sigloxxi.com, Édgar Barquín, the Superintendent of Banks, explained that banks "have been able to defer or restructure them [the credit lines] to maintain the financing used by local banks in productive sector loans" and that the country "has been fortunate in the way correspondent banks have responded."
July 2010
Local companies have taken out loans with foreign banks worth approximately $1.2 billion.
The head of the Guatemalan Banking Regulator (SIB), Édgar Barquín, indicated that the loans mostly come from Panama and the USA.
"According to Barquín, one of the reasons companies have looked elsewhere for credit is that they have found better terms abroad, such as lower interest rates or less strict requirements".
August 2011
The International Finance Corporation has granted a loan to Banco General de Panama so that it can offer more mortgages to low-income families.
The $50 million long-term IFC funding , which will run for seven years, will enable Banco General match the maturity needed to finance mortgages for low-income groups.
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