Banking
From The Report: Peru 2015
View in Online Reader

With a record of consistent profitability and credit growth, the banking sector has ridden the wave of Peru’s economic expansion during the past decade. As of June 2014, direct lending by the banking sector stood at PEN211.7bn ($75.58bn), having increased by 16% over the previous year. A firm regulatory environment is credited with having ensured that the country’s banks made it through the 2008 global financial crisis relatively unscathed. However, in 2014, the proposed end of the commodities supercycle, an economic slowdown and the prospect of rising international interest rates presented the banks with a new set of challenges. Even so, recent developments, including accelerating de-dollarisation and the consolidation of microfinance providers, suggest that the maturing industry is already dealing with these issues. The sector is set to see continued growth going into 2015.

This chapter contains interviews with Julio Velarde, Governor, Central Reserve Bank of Peru (BCRP); Carlos González-Taboada, CEO, Scotiabank Peru; and Daniel Schydlowsky, Superintendent for Banks, Insurance and Pension Funds.

Articles from this Chapter

Overview

The banking industry looks set to achieve its full potential in the coming years, outperforming other sectors of the economy
OBG
plus

With a record of consistent profitability and credit growth, the banking sector has benefitted from economic expansion in the past decade. Strong regulations are credited with having ensured that banks made it through the 2008 global financial crisis relatively unscathed. In 2014, the proposed end of the commodities supercycle, an economic slowdown and the prospect of rising international interest rates presented banks with new challenges. However, recent developments, such as accelerating de-dollarisation…

Interview

OBG talks to Julio Velarde, Governor, Central Reserve Bank of Peru (BCRP)
OBG
plus

Interview:Julio Velarde What can the country do to keep inflation in check? JULIO VELARDE: Low inflation in Peru is the result of the BCRP’s credibility. It reflects both a strong institutional framework, which ensures central bank independence and the performance of monetary policy. The inflation targeting regime adopted in 2002 has been crucial to the BCRP’s good performance. Since adopting this strategy, underlying inflation has been 2%, with a 2.8% yearly average. The forecast for…

Interview

OBG talks to Julio Velarde, Governor, Central Reserve Bank of Peru (BCRP)
OBG
plus

Interview:Julio Velarde What can the country do to keep inflation in check? JULIO VELARDE: Low inflation in Peru is the result of the BCRP’s credibility. It reflects both a strong institutional framework, which ensures central bank independence and the performance of monetary policy. The inflation targeting regime adopted in 2002 has been crucial to the BCRP’s good performance. Since adopting this strategy, underlying inflation has been 2%, with a 2.8% yearly average. The forecast for…

Analysis

Every little bit helps: The microfinance industry has played an important role in improving social development, despite facing challenges in recent years
OBG
plus

The centrality of microfinance to Peru’s economy extends beyond its contribution to banking profits, given its role in reducing poverty, accelerating formalisation of the workforce and bringing growth to regions previously beyond the reach of traditional banks. Even so, its development has not been consistently smooth. Some weaker players have been taken over or merged with their competitors, and a reorganisation of the industry that looks set to continue into 2015. Industry Structure Darío…

Interview

Carlos González-Taboada, CEO, Scotiabank Peru: Interview
OBG
plus

Interview:Carlos González-Taboada Will mortgage loans continue to grow in Peru? CARLOS GONZÁLEZ-TABOADA: In line with the rise of the middle class and higher average salaries, mortgage loan activity has increased exponentially since 2009, at an annual average rate of around 20%. However, this is not sustainable for the long term, and growth is likely to settle to around 10%. Additionally, investment in real estate development has spiked up, driven by greater and more sophisticated demand. All…

Interview

Carlos González-Taboada, CEO, Scotiabank Peru: Interview
OBG
plus

Interview:Carlos González-Taboada Will mortgage loans continue to grow in Peru? CARLOS GONZÁLEZ-TABOADA: In line with the rise of the middle class and higher average salaries, mortgage loan activity has increased exponentially since 2009, at an annual average rate of around 20%. However, this is not sustainable for the long term, and growth is likely to settle to around 10%. Additionally, investment in real estate development has spiked up, driven by greater and more sophisticated demand. All…

Interview

Daniel Schydlowsky, Superintendent for Banks, Insurance and Pension Funds: Interview
OBG
plus

Interview:Daniel Schydlowsky Just one in five Peruvians has a bank account. To what extent does this limit banking sector growth? DANIEL SCHYDLOWSKY: Low banking penetration figures are the result of many factors. In the case of Peru, geographic dispersion, a high level of informality, a lack of trust in the financial system and a low level of financial education are at play. Despite this, the number of financial users has doubled since 2009, which is substantial. Loans have increased to…

Interview

Daniel Schydlowsky, Superintendent for Banks, Insurance and Pension Funds: Interview
OBG
plus

Interview:Daniel Schydlowsky Just one in five Peruvians has a bank account. To what extent does this limit banking sector growth? DANIEL SCHYDLOWSKY: Low banking penetration figures are the result of many factors. In the case of Peru, geographic dispersion, a high level of informality, a lack of trust in the financial system and a low level of financial education are at play. Despite this, the number of financial users has doubled since 2009, which is substantial. Loans have increased to…