Executive summary
As of December 1997, monetary resources amounted to $82,000 million, and came to represent more than 23% of the Gross Domestic Product, 3 percentage points more than the previous year. Deposits accumulated a growth of 30% in the year and 3.8% in the quarter, while loans to the non-financial private sector grew 15% and 3.4% respectively.
The international reserves of the financial system climbed to $ 31,270 million in December, 37% increase over the previous year. Between September and December they registered an expansion of $ 2,850 million, with 70% of the increase corresponding to the BCRA’s gold and foreign exchange reserves. The ratio of Gold Reserves and Foreign Exchange/Financial Liabilities was 100% for most of the quarter.
In December, the BCRA approved an extension of the contingent line of passes that brings the total amount of the program to $6,700 million. Thus, the systemic liquidity indicator stood at 29.6% of deposits, 12 percentage points more than at the end of 1996, constituting an important reinsurance against any liquidity shock.
The financial crisis in Asian economies led to an increase in short-term interest rates in the interfinancial market at the end of October, which then fell but did not return to previous values, this time influenced by the greater need for funds characteristic of December.
This bulletin analyses the data from the financial statements of private banks for the August-October 1997 quarter. In the period, the growth of private banking continued, and, despite the fact that the result obtained was almost zero as a result of the fall in the prices of financial assets caused by the global financial crisis, the structure of profitability showed significant gains in efficiency and a sharp drop in the incidence of bad debt charges. On the other hand, the level of irregularity of the portfolio decreased significantly.
