Informe Sobre Bancos

Thisreport analyzes the situation of the Argentine financial system on a monthly basis.

Summary

• Bank credit granted to the private sector increased in November, while delinquency levels remained historically low. In this context, the sector earned higher profits and improved efficiency indicators, while exhibiting significant prudential capital and liquidity margins. In contrast to the measures implemented by the BCRA throughout 2010 and 2011, aimed at extending the levels of banking penetration of the population, the number of immediate transfers expanded 62% throughout the second half of 2011 to almost 1.5 million in December (of which almost 96% were for amounts of less than $10,000). Universal free accounts stood at around 93,000 units, while in 2011 the opening of 67 branches was approved in areas with a relatively lower level of banking penetration.
• In November, the balance of deposits in national currency, both in the private and public sectors, maintained the growth pattern that had been observed in previous periods. In particular, total deposits in pesos of the private sector increased almost 2% in the month (30.4% y.o.y.), with time placements showing a relatively more dynamic performance. For its part, in November the balance of total deposits denominated in foreign currency verified a significant reduction. In response, the BCRA ordered a temporary modification of the minimum cash rules referring to the determination of the basis for calculating the minimum daily integration. Overall, the balance of total deposits in the financial system fell 0.6% in November, although maintaining a significant year-on-year growth of almost 24%.
• The broad liquidity indicator for the group of financial institutions (considering items in pesos and foreign currency, as well as the bills and notes of this Institution) fell 1.3 p.p. of total deposits in the month to 37%, mainly due to the reduction in the holding of Lebac and Nobac and cash in foreign currency. This indicator accumulated a year-on-year reduction of 9 p.p. in the context of the growth of banks’ financial intermediation with the private sector. On the other hand, the liquidity indicator that includes only items in pesos (excluding the position in Lebac and Nobac) verified a slight monthly increase, reaching levels similar to those of November 2010 (19.5% of deposits in pesos).
• Credit to the private sector grew 1.9% in November, slightly moderating the monthly rate of expansion it had been registering in 2011. The monthly increase in lending was driven mainly by public banks. In year-on-year terms, credit to the private sector expanded 50.3%, 15.5 p.p. above the November 2010 figure. Almost 60% of the growth in credit to the private sector was explained by the increase in loans to companies. Financing to the private sector reached 51.1% of the assets of the financial system in November, increasing its weighting by almost 9 p.p. in the last 12 months, constituting the largest year-on-year increase in the last 10 years.
• In November, the non-compliance ratio of financing to the private sector remained low and stable at around 1.4%, with a decrease over the course of the year of 0.7 p.p., as a result of both a fall in the balance in an irregular situation and the dynamism of financing to the private sector. On the other hand, the coverage of the portfolio in an irregular situation with forecasts stood at 172% in the month, 29 p.p. more than at the end of 2010.
• The net worth of the consolidated financial system expanded 1.8% in November, mainly as a result of accounting profits and, to a lesser extent, capital contributions. The capital integration ratio of the financial system remained stable in the month, at around 15.8% of risk-weighted assets (RWA). All bank groups have a comfortable surplus capital position in terms of local requirements.
• After the increase that had been verified last month, in November the profitability of the banks as a whole was at levels in line with the annual average, reaching 2.4% of assets. The monthly decline in earnings was mainly explained by lower earnings from securities. Throughout the year, the profits accounted for by the sector amounted to 2.6% of assets. During 2011, the main indicators of efficiency of the financial system continued to show significant improvements, as a result of a relatively higher growth in the most stable income (from interest and services), compared to the behavior of the main expenses (administrative expenses and charges for uncollectibility) in the income statement.