Report on Banks, September 2024
• In September, the stock of loans to the private sector in real terms continued expanding, while the non-performance ratio of financing remained unchanged at moderate levels. Within this context, the soundness indicators of the financial system remained high.
• The stock of credit in pesos to the private sector grew 6.7% in real terms in September (ARS3 trillion in constant currency), reaching ARS48.4 trillion. The growth was reflected in all credit lines, evidencing an increase of 48.6% from the level observed at the end of April. The stock of loans to the private sector in real terms posted a 5.8% y.o.y. change, a positive variation that had not occurred since mid-2022. The stock of loans in foreign currency increased 8.5% in September, and 93.3% y.o.y. (in original currency). The total stock of loans to the private sector in real terms (in domestic and foreign currency) increased 6.7% in September and 12% y.o.y., reversing the negative y.o.y. rates observed over the past 6 years.
• In September, the non-performance ratio of loans to the private sector remained at around 1.6% for the aggregate financial system. The non-performance ratio of financing to companies totaled 0.7%, while that of households stood at 2.6%, with no significant changes in either segment compared to August. The ensemble of financial institutions posted high levels of provisioning—174.3% of the stock of non-performing loans in September (109% considering the stock of provisions for the non-performing portfolio).
• The stock of private sector deposits in pesos increased 1% in real terms in September, with a rise in time deposits and a decrease in sight accounts. Under the Asset Regularization Regime, the stock of private sector deposits in foreign currency grew 62.7% in September, reaching a level similar to that of mid-2019 (USD31,600 million).
• The stock of total deposits (in domestic and foreign currency, in all sectors) improved 12.7% in real terms in September.
• The broad liquidity ratio in domestic currency increased 1.6 p.p. of deposits in the same currency, to 36.8%. The liquidity ratio in foreign currency stood at 83.5% of deposits, up 7.1 p.p. against the end of August, explained by the inflows under the Asset Regularization Regime.
• In September, financial institutions' regulatory capital (RC) compliance stood at 34.7% of risk-weighted assets (RWAs), down 1.8 p.p. against August in a context of expansion of credit. The regulatory capital surplus of the financial system represented 336% of the regulatory requirement and 58.3% of the stock of financing to the private sector (net of provisions).
• The profitability indicators of the financial system have shown a downward trend in recent months. The total comprehensive income in constant currency accumulated in the past three months to September stood at 1.9% annualized (a.) of assets (return on assets, ROA) and 7% (a.) of the net worth (return on equity, ROE), posting lower levels against the previous months. In the past 12 months to September, the ROA was equal to 6.8% and the ROE totaled 26.9% for the ensemble of financial institutions.
• Instant transfers decreased against August, though still expanding in y.o.y. terms (74.6% in volume and 32.5% in value in real terms). In September, payments by transfer (pagos con transferencia, PCTs) using interoperable QR codes increased 4% in volume and 3.6% in value in real terms (159.8% y.o.y. in volume and 119.9% y.o.y. in value in real terms). E-checks continued gaining share in cleared checks: 50.1% in volume and 76% in value.
Report (full text) - in Spanish -
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November 20, 2024
