Fitch Ratings said that Peruvian banks have liquidity to buffer the growing challenges of the coronavirus pandemic and ruled out major refinancing risks of their clients' debts.
According to Fitch Ratings, he said, deposits are broad, atomized and low-cost in the case of Peruvian and Colombian banks.
"In any case, there are no major refinancing risks, thanks to the absence of near-term debt maturities, so banks' liquidity and the support of central banks should be sufficient to meet short-term financial obligations in the event of moderate deposit outflows," Marquez explained.
Additionally, the Fitch officer stressed the fact that both Colombian and
Peruvian banks have reasonable capital cushions that provide them with an adequate buffer to deal with the growing challenges posed by this pandemic.
Measures taken
On the other hand, he underscored the efforts of governments, central banks and banking system regulators in the region, with measures to maintain liquidity, support the most vulnerable sectors, and try to contain a deterioration in asset quality of banks, as in the case of Peru.
"Among the measures taken in Peru, in first place, are the coverage of finance funds and issuance of guarantees, the support for small and medium-sized companies, as well as the empowerment of banks to take exceptional measures in credit terms and monetary expansion measures in terms of reference rates and banking reserve management. All of this in addition to
a big fiscal stimulus package that has been recently launched," he added.
Remarks were made by Latin America Financial Institutions Senior Director Andres Marquez during the webinar "Coronavirus Impact on the Portfolio of Banks and Financial Institutions in the Andean region."
(END) MDV/RMB/MVB
Published: 4/2/2020