Forecasts for economic growth and expanding loan portfolios is good news for Colombia’s banks, as Danielle Myles discovers.
The World Bank recently forecast that Colombia’s economy will grow 2.9% in 2018, nearly 1% more than the Latin American and Caribbean region as a whole. Meanwhile the country’s banking association Asobancaria has predicted that its members’ loan portfolios will grow 6.3% over the same period.
The organisations gave similar reasons for their predictions, including increased domestic consumption, recovering exports, and the lowering of interest rates over 2017. The central bank unexpectedly cut the benchmark rate again in January 2018, but said “the reduction cycle of the interest rate has been completed”. It suggests now is the ideal time to borrow.
This is all good news for Colombia’s lenders, particularly the six that account that for more than 80% of the country’s bank assets. The biggest is Bancolombia, which from its headquarters in Medellin owns $65.4bn in assets. Next is Banco de Bogota with $47.1bn and Banco Davivienda with $31.2bn.
The chaser pack is led by BBVA’s local subsidiary ($17.2bn in assets) followed by Cali-headquartered Banco de Occidente ($11.9bn). Rounding out the top six is Chilean CorpBanca’s local outfit with $11bn in assets.
All data sourced from www.thebankerdatabase.com
