Mexico | Monthly Report on Banking and the Financial System. April 2023

Summary

During February 2023, the balance of the current credit portfolio granted by commercial banks to the non-financial private sector (NFPS) grew 4.8% real per year (12.8% nominal), while traditional bank deposits decreased by a real contraction of 1.4% (equivalent to nominal growth of 6.1%).

Key points

• Key points:
• The real balances of current credit to the NFPS have not yet recovered compared to February 2020, due to the still incomplete recovery of the consumer and business portfolios.
• Bank deposits have been the protagonist of a recomposition of balances towards demand deposits since February 2020, due, in large part, to the liquidity accumulated during the pandemic.
• Current credit exhibited great dynamism in the Center-North and South of the country in 4Q22, due to greater financing for industrial activities.
• Credit crunch? Markets seem to think so and price in rate cuts ahead in another clear disagreement with FED projections.

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