Consumers Aid Mexican Bank Lending Growth in 2Q
Amy Guthrie - Dow Jones
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August 6, 2012

The Mexican banking system's loan portfolio increased by 3.6% during the second quarter versus March, with credit to consumers picking up an even stronger 5.6%.

Mexican banking regulator CNBV said last week that the 42 financial institutions it monitors reported a combined credit portfolio worth 2.58 trillion pesos ($193 billion) as of end-June, up 15.4% on the year.

Some of the country's largest banks fed the annual credit expansion, with the Mexican unit of Spain's Banco Santander SA (SAN, SAN.MC) showing a 17% rise in its loan portfolio versus June 2011 while Mexico's Grupo Financiero Banorte SAB (GBOOY, GFNORTE.MX) increased its credit portfolio by 21% and Citigroup Inc.'s (C) Banamex unit expanded its portfolio by 18%.

The CNBV said Mexican banks reported an average bad debt rate of 2.50% versus 2.45% in March and at end-2011.

The banks expanded their assets by 3.3% to MXN5.99 trillion during the April-June period, while attracting MXN2.81 trillion in deposits, or 2.9% more than in March.

The Mexican economy is widely seen growing close to 4% this year, aided in part by consumer spending and more available consumer credit.

Credit Suisse said in a note Wednesday that expectations for solid economic growth during the second half of 2012 should help accelerate credit in Mexico even further than the bank's forecast for a 15% to 18% annual expansion this year.

Write to Amy Guthrie at amy.guthrie@dowjones.com

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