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In April 2021, the nominal annual contraction of current commercial banking credit to the non-financial private sector was -8.8% (-14.1% real). Despite the improvement in some indicators of economic activity, the different portfolios showed a lag in their recovery.
Bank credit to the private sector fell 7.9% in March due to the performance of the consumer and business portfolios, while demand deposits continued to drive bank deposits.
The Lima Consumer Price Index (CPI) rose 0.27% MoM in May (-0.10% in April) due to higher food prices. Inflation in year-on-year terms was 2.4%.
Spanish companies are facing the invisible attack of COVID-19 from a position of relative strength after experiencing strong deleveraging over the past decade due to the Global Financial Crisis, which led them to lower their debt from levels of more than 110% of GDP (2008) to 73% (2019).
The banking system has maintained outstanding capital and liquidity levels, which up to now have allowed it to face the adverse effects associated with the pandemic.
The 2020 banking dynamics of lower credit granted to the private sector and a sharp increase in banking deposits were among the causes of better financing conditions for the banking system and a higher solvency.
Traditional bank deposits (sight + term) continued to grow in February, supported by the sight segment and despite the fall in the balance of time deposits during the last ten months. However, within sight deposits, there were changes in terms of their sources of growth.
April 16, 2021
Mexico | Bank credit fell 2.0% due to the performance of the consumer & business portfolio
During February 2021, the nominal balance of the current loan portfolio granted by commercial banks to the non-financial private sector fell 2.0%. The annual rate reduction in nominal balances was greater than in January (-1.3%), accentuating the downward trend observed since May 2020.