Banking
From The Report: Mexico 2015
View in Online Reader

Mexico’s banking system has enjoyed two decades of growth and stability. Operating with comparatively high capital reserve levels, Mexico has a stable and profitable banking system. In the period from 2010 to 2014, the financial system as a whole grew at an average annual rate of 10%. As of March 2015 total assets in the commercial banking system stood at $541.8bn, with 45 active banks. The industry has a high level of concentration: the top six banks controlled 58.7% of total assets and 60.2% of the total loan portfolio. Recent adjustments to the regulatory framework, such as the 2014 banking reform, can be seen as fine-tuning an essentially robust industry framework. However, banking penetration remains low and financial exclusion indicators are comparatively high, with more than half the population not having a bank account.

This chapter features an interview with José Marcos Ramírez, CEO, Grupo Financiero Banorte.

Articles from this Chapter

Overview

Growth and stability: Reforms introduced in 2014 should further strengthen the increasingly competitive sector
OBG
plus

Operating with comparatively high capital reserve levels, Mexico has a strong and profitable banking system. Both the commercial banks and the regulatory authorities have a prudent and conservative outlook on the way the sector is run. The banking system has enjoyed two decades of growth and stability. This cautious culture is a lasting and deeply ingrained response to earlier troubles, and in particular to the 1994-95 “tequila crisis” which saw the entire banking system come close to collapse.…

Analysis

Opportunities abound: Banks are developing mobile and internet banking services for a growing number of online customers
OBG
plus

Mobile and internet banking is at a relatively early stage of development in Mexico, but most players are convinced that it is the shape of things to come, and that banks that do not invest in developing their online and mobile presence are at risk of losing market share. According to a study by BBVA Research, around 16% of Mexico’s total banking transactions are carried out online, and 6.4% of them are done through mobile phones. For comparison, the study said 40% of Brazil’s transactions are…

Interview

Necessary precautions: OBG talks to José Marcos Ramírez, CEO, Grupo Financiero Banorte
OBG
plus

Interview:José Marcos Ramírez Who are the main beneficiaries of bank loans? JOSE MARCOS RAMÍREZ: At present, 84.3% of credit is provided by private sector banks and 15.7% by government-owned financial institutions. Private sector loans are 50.5% corporate, 19.1% mortgages and the rest is consumption, including 11.3% on credit cards. The real tragedy is that bank credit to the non-financial private sector represents barely 16% of GDP, while the figure in Peru is around 20%, 40% in Colombia,…

Analysis

Profitable activity: Lending continues to grow, while the ratio of non-performing loans falls
OBG
plus

During their annual convention in May 2015, leaders of the Mexican Banking Association (Asociación de Banqueros de México, ABM) said that the industry was doing well. “Mexican banking is experiencing the best credit growth cycle in its history,” Luis Robles Miaja, president of the ABM, said, adding that “credit has been growing at a rate 3.7 times faster than GDP over the last 11 years”. The ABM said lending to all sectors had expanded in the first quarter of 2015, while non-performing…