Latin Finance - November/December 2011 - 56

2011

“Future bets include a greater participation in businesses at a Central American level, in financing as well as investment banking, while in the local market the vision consists in continuing to be the bank of choice for our clients,” says Agricola. LF

Guatemala
Best Bank – Banco Industrial

Ready to Compete

H

aving used the global financial crisis to better prepare for external turmoil, Guatemala’s leading bank looks at home and abroad to continue expanding. Greater banking penetration is an area of opportunity, says Luis Prado, head of the Banco Industrial’s international division. Guatemala’s largest bank aims to become the leading financial conglomerate in Central America and says it will gladly challenge international competitors in taking a foothold in untapped markets. In its latest cross-border move, Banco Industrial launched services this July in El Salvador. It is also the fifth-largest bank in Honduras and is eyeing Panama and Costa Rica for mid-term expansion. But its biggest near-term opportunities might be right at home, where banking penetration (ratio of loans value to GDP) is only 25%, according to the World Bank. Industrial, primarily a commercial bank, hopes to help change that. One way of reaching Guatemala’s vast population without banking services is through family remittances, which took a hit during the last 2008-2009 downturn but are on track to top pre-crisis levels, Prado says. Industrial handles about a quarter of Guatemala’s $4 billion in annual remittances in some 1.2 million transactions. “We reach a population that doesn’t have a banking relationship,” he says. The goal is to encourage a culture of saving, increase financial education

and provide basic financial products. Industrial has some 1.6 million individual account holders but fewer 500,000 credit clients, says Prado. Microcredit and retail outlet branches are vehicles for expansion. “We consider greater penetration in the retail segment important because those are the segments that give greater profitability, better financial margins,” says Prado, adding that portfolio diversification will be key to maintaining the bank’s historic profit levels. “The competition is intense and there are many international banks competing in the market and in Central America in general.” A return to pre-crisis levels in remittances is only one sign that Guatemala’s economy is turning a corner. “In the last quarter of 2010 and so far in 2011, we have again seen investment decisions in new companies, new projects or increased capacity in existing companies,” says Prado, pointing to energy, sugar and manufacturing as growth sectors. As of end-June, Industrial had a 27.5% share of the Guatemalan banking system, with 44.8 billion quetzales ($5.75 billion) in unconsolidated assets, compared to G&T Continental’s 32.5 billion quetzales, according to the bank regulator. This compares to Industrial’s 38.68 billion quetzales in assets in June 2010. Return on assets was 2.1%, compared to 1.92% a year earlier, and return on equity stood at 25.6%, compared to 22.05% in the previous period. Prado expects Guatemala and the banking system to weather the developed nations’ continued economic turmoil. “I don’t see a greater impact than what we had in the last crisis,” says Prado. Banks have already taken steps to protect themselves against another economic downturn, including greater liquidity positions, more conservative credit policies and stringent collection e orts. LF

Panama
Best Bank – Banco General

Keeping the Lead
or the third straight year, Banco General takes the top spot in the highly competitive banking sector in Panama, Central America’s booming services-based economy. With Panama’s economy barely hiccupping during the global downturn and again flirting with double-digit growth in 2011, staying on top of the heap is a challenge – especially with major international banks and strong local players numbering in the dozens in Central America’s star economy. Banco General, second only to HSBC in terms of assets, posted a net income of $213.6 million, an 8.52% increase over the same annualized period in 2010, the bank reports. ROE was 21.76% and ROA was 2.64% as of June 2011, compared to 19.37% and 2.46%, both continuing on last year’s upward trend. Liquid assets were 38.34% of total received deposits and obligations. General is the largest locally controlled bank in Panama with 19.3% of the market’s share in local loans. Even though there was a highly competitive environment during the period, Banco General achieved strong financial performance and a robust balance sheet with high liquidity levels, it says. This strong performance should once again place Banco General in the upper tier of the local as well as the regional banking industry.” Assets stood just shy of $9 billion, with the bank giving credit to a 5.5% increase in its loan portfolio. General is leading the market in residential mortgages with 28.73% share as of May. Non-performing loans were an enviable 0.61% of total loans through June 2011. The bank also boasts $6.76 billion in local deposits, 25% of the market, the bank says. “The diversification of our portfolio of loans and sources of deposits, as well as the ample o er of bank products and channels of distribution, has permitted

F

UPDATE
For daily news of local market transactions, see www.latinfinance.com

>

56 LATINFINANCE

November/December 2011


http://www.latinfinance.com

Latin Finance - November/December 2011

Table of Contents for the Digital Edition of Latin Finance - November/December 2011

Latin Finance - November/December 2011
Contents
Contagion Risk
Mexican Credit
China Investment
Loan Markets
Mexico Banks
Sub-Sovereign Debt
Banks of the Year 2011
Argentina Investor Report
Reversal of Fortunes
Latin Finance - November/December 2011 - Latin Finance - November/December 2011
Latin Finance - November/December 2011 - Cover2
Latin Finance - November/December 2011 - Contents
Latin Finance - November/December 2011 - 2
Latin Finance - November/December 2011 - 3
Latin Finance - November/December 2011 - 4
Latin Finance - November/December 2011 - 5
Latin Finance - November/December 2011 - 6
Latin Finance - November/December 2011 - 7
Latin Finance - November/December 2011 - 8
Latin Finance - November/December 2011 - 9
Latin Finance - November/December 2011 - 10
Latin Finance - November/December 2011 - 11
Latin Finance - November/December 2011 - Contagion Risk
Latin Finance - November/December 2011 - 13
Latin Finance - November/December 2011 - 14
Latin Finance - November/December 2011 - 15
Latin Finance - November/December 2011 - 16
Latin Finance - November/December 2011 - 17
Latin Finance - November/December 2011 - 18
Latin Finance - November/December 2011 - 19
Latin Finance - November/December 2011 - 20
Latin Finance - November/December 2011 - 21
Latin Finance - November/December 2011 - Mexican Credit
Latin Finance - November/December 2011 - 23
Latin Finance - November/December 2011 - 24
Latin Finance - November/December 2011 - 25
Latin Finance - November/December 2011 - China Investment
Latin Finance - November/December 2011 - 27
Latin Finance - November/December 2011 - 28
Latin Finance - November/December 2011 - 29
Latin Finance - November/December 2011 - Loan Markets
Latin Finance - November/December 2011 - 31
Latin Finance - November/December 2011 - 32
Latin Finance - November/December 2011 - 33
Latin Finance - November/December 2011 - Mexico Banks
Latin Finance - November/December 2011 - 35
Latin Finance - November/December 2011 - Sub-Sovereign Debt
Latin Finance - November/December 2011 - 37
Latin Finance - November/December 2011 - Banks of the Year 2011
Latin Finance - November/December 2011 - 39
Latin Finance - November/December 2011 - 40
Latin Finance - November/December 2011 - 41
Latin Finance - November/December 2011 - 42
Latin Finance - November/December 2011 - 43
Latin Finance - November/December 2011 - 44
Latin Finance - November/December 2011 - 45
Latin Finance - November/December 2011 - 46
Latin Finance - November/December 2011 - 47
Latin Finance - November/December 2011 - 48
Latin Finance - November/December 2011 - 49
Latin Finance - November/December 2011 - 50
Latin Finance - November/December 2011 - 51
Latin Finance - November/December 2011 - 52
Latin Finance - November/December 2011 - 53
Latin Finance - November/December 2011 - 54
Latin Finance - November/December 2011 - 55
Latin Finance - November/December 2011 - 56
Latin Finance - November/December 2011 - 57
Latin Finance - November/December 2011 - 58
Latin Finance - November/December 2011 - 59
Latin Finance - November/December 2011 - 60
Latin Finance - November/December 2011 - Argentina Investor Report
Latin Finance - November/December 2011 - 62
Latin Finance - November/December 2011 - 63
Latin Finance - November/December 2011 - Reversal of Fortunes
Latin Finance - November/December 2011 - Cover3
Latin Finance - November/December 2011 - Cover4
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