Informe Sobre Bancos

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

Summary

• The financial system at the aggregate level maintained its attributes of liquidity and solvency in November
  2016, setting up a scenario with a significant potential margin for growth in intermediation activity in the coming months. In this context, the BCRA continues to implement a
  set of measures aimed at generating greater and better access to financial services and a
  greater degree of competition among institutions, with the consequent benefit for borrowers
  and depositors. In particular, in recent months the BCRA has expanded the allocation of
  lending capacity in foreign currency (within a framework of adequate management of the risk of mismatch),
  authorized the creation of savings banks for minors, enabled banks to pay interest
  on the amounts deposited in current accounts, it expanded access to credit information, advanced in
  the digitization of financial users’ transactions, promoted longer-term
  funding (such as the adjustable by Purchasing Value Units (UVA)) and continued to adjust local regulations to international
  recommendations that promote a framework of financial stability.
• At the end of December 2016, this Institution released the financial
  policy guidelines for 20171
  , highlighting that it will promote the deepening of long-term savings and credit
  (UVA) tools, greater competition and efficiency in banking activity, continue with convergence towards Basel III regulatory standards and modernize the payment system.
• Against the backdrop of lower levels of inflation, lower nominal interest rates and
  positive real yields for some savings instruments, the downward trend in the profitability of the financial system continued in November, as observed since the middle of the
  year. The system’s monthly gains stood at 2.4% annualized (a.y.) in terms of assets
  (ROA), 0.4 p.p. less than in October and 2.1 p.p. below the same month in 2015. In the cumulative
  period from January to November 2016, the aggregate nominal earnings of the entities reached almost $67,800
  million (a growth of 29% compared to the amount of the same period in 2015), while the profitability in terms of assets was 3.7%y, with a fall of 0.3 p.p. in a year-on-year comparison.
• In the month, the balance of total financing (in domestic and foreign currency) to the private
  sector increased 4% in nominal terms or 2.4% when adjusted for inflation2
  , thus verifying positive real growth for the fourth consecutive month. Foreign currency lines showed an increase of 4.8%3
  in the period (tripling in year-on-year terms), while the segment in pesos
  grew nominally 3.1% (1.5% when adjusted for inflation). By recipient, the aggregate of loans to
  households showed the highest monthly relative growth.
• The non-performing loan ratio for loans to the private sector fell slightly in November to
  1.8%, a performance that was recorded in almost all groups of institutions. The NPL ratios for
  financing to households and companies stood at 2.7% and 1.2%, respectively, in the period. Accounting forecasts accounted for 139% of irregular loans to the private sector.
• Total private sector deposits grew 7.7% in the month (6% adjusted for inflation), an evolution that was mainly explained by the 25% increase in deposits in foreign currency
  due to the effects of the Fiscal Sincerity Regime. For its part, the balance of deposits in pesos of
  the private sector grew 2.2% in the month.
• In November, liquid assets (in pesos and dollars, excluding LEBAC) stood at 33.5%, 1.2
  p.p. less than in the previous month and 8.8 more than the figure for the same month of the previous year. Considering the holding of LEBACs not linked to pass operations, the broad liquidity ratio stood
  at 50.2% of total deposits, 2 p.p. below last month’s figure, although it
  remains 7.4 p.p. above the value of November 2015.
• The capital integration of the financial system stood at 17% of risk-weighted
  assets (RWA) in November, 0.3 p.p. above the October level. Tier 1 capital still accounts for more than 90% of total capital