Report on Banks

Executive Summary

Financial intermediation with the private sector increased in June, both in pesos and in foreign currency. This performance occurred in a context of appropriate coverage margins in terms of liquidity, provisions, and capital at an aggregate level.

The real stock of loans to the private sector in pesos granted by the financial system grew by 1.7% (2.6% y.o.y. in real terms). Growth was broad-based across all credit lines, with the performance of business loans standing out. The stock of financing to the private sector in foreign currency grew by 4.6% (in original currency) (+53.2% y.o.y.). Taking into account all currencies, the real stock of financing to the private sector granted by the ensemble of institutions improved by 3.1% against May at systemic level (10.1% y.o.y.).

Due to seasonal factors, the real stock of private sector deposits in pesos in the financial system increased by 3.9% in June (-1.2% y.o.y.), mainly explained by the performance of sight deposits. The stock of private sector deposits in foreign currency increased by 1.1% month-on-month end-of-period (in original currency) (27.4% y.o.y.).

The non-performing loan ratio for the private sector decreased in June, reaching 7.6% at an aggregate level (-0.1 p.p. monthly). The delinquency rate for household financing stood at 12.8%, while that for companies totaled 3.5%. The performance of the delinquency ratio for private sector (and household) financing was explained by a slowdown in the real growth pace of the non-performing portfolio and a real increase in total credit. The estimated probability of default (PD) for the total stock of loans to the private sector decreased to reach 2.6% in the period. The financial system continued posting high levels of coverage against credit risk. Total provisions accounted for 86.6% of the non-performing portfolio and 6.5% of total financings.

In June, the stock of financing in pesos totaled 12.7% of deposits in that currency at an aggregate level (+0.8 p.p. against May). When government securities used to comply with minimum cash requirements are included as well as short-term net transactions in pesos with the BCRA, this liquidity indicator reached 34% of deposits in pesos (+1.4 p.p. monthly). Aggregate liquidity in foreign currency stood at 48.6% of these deposits (-2.3 p.p. monthly).

The financial system closed the first half of the year with high solvency levels. Regulatory capital (RC) compliance totaled 29.8% of risk-weighted assets in June (-0.9 p.p. monthly). The surplus of RC totaled 269% (-12.3 p.p. monthly), and 35.4% of financing to the private sector net of provisions (-1.6 p.p. monthly).

Financial system profitability increased in the second quarter of 2026, with aggregate results equivalent to an annualized 2.5% of assets (ROA), above previous periods. For the last 12 months, ROA reached 1.2%, marking a year-on-year slight decline.