September 14, 2021
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For the third consecutive month, the contraction in the annual growth rate of current portfolio balances to the non-financial private sector has been milder, which reaffirms that total bank credit is on the way to a recovery, although its magnitude differs across portfolios.
Households did not consolidate their spending pattern and increased their liquid balances again in June, while bank credit reduced the magnitude of its contraction, falling 6.1%.
Unlike in previous crises, lending has not slowed down during the pandemic—at least not in all segments— with a fall in household loans, but a big increase in corporate lending.
August 20, 2021
Mexico | Bank lending falls 6.1%, a decline of a lesser magnitude than in previous months
A milder contraction in the annual growth rate of outstanding balances for the second consecutive month provides encouraging signs that the negative impact of the pandemic on banking credit has moved past its worst point and could be on a recovery path.
May could represent a turning point in the dynamics of total credit to the non-financial private sector, with an aggregate contraction smaller than the one experienced in April and a better performance by portfolios, while bank deposits also showed signs of a change in trend in its dynamics.
May could represent a turning point in the dynamics of credit to the NFPS, with a smaller contraction than the one in April and a better performance of the portfolios that comprise it. An improvement in the activity and employment indicators in the medium term would consolidate a better performance in the credit market.
More than year after the start of the pandemic, the number of non-performing loans (NPLs) in the Spanish banking system continues to fall, though at a slower rate than before.
Banco de México reiterated the resilience of the financial system in the face of the adverse shock of the pandemic, as credits granted remain weak (-8.8% YoY in April) and levels of bank deposits remain close to historical highs.