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Lower rates: public banks step up and reduce the cost of loans for individuals, retirees and SMEs

2024-03-14T17:45:29.531Z

Highlights: Lower rates: public banks step up and reduce the cost of loans for individuals, retirees and SMEs. Banco Nación moved forward with a cut of 25 percentage points in its general portfolio and for retirees. The Province took the rate for companies to 47%. The private sector is still "analyzing" changes. NE NE NE NE NE The speed of reflexes of the financial sector at this point could be key to reducing in the coming months the fall in private credit, according to data firm LCG.


Banco Nación moved forward with a cut of 25 percentage points in its general portfolio and for retirees. The Province took the rate for companies to 47%. The private sector is still "analyzing" changes.


One of the positive side effects of the abrupt drop in rates issued by the Central Bank this week

should be the reduction in the cost of private credit

, which has been paralyzed for months.

Public banks

stepped

up and announced

a sharp cut

in the rates associated with the financing of families and businesses;

while private entities are still "analyzing" the issue.

This Thursday,

Banco Nación

reported that it is cutting loan rates in pesos for

people and retirees

who receive salaries in its entity of the order of

25 percentage points.

In this way, the credit rate for the general portfolio

drops from 89% to 63%

, while for

retirees it is also reduced from 88% annually to 63%.

During the week, the organization had already advanced with a similar decrease for the

agricultural sector and brought

the cost of requesting a loan to finance the purchase of machinery for this sector to 44% annually.

Generally, it is the public bank that comes forward to make these types of moves, which functions as a

"spearhead"

for the entire rest of the financial system.

Still led by another political sign,

Banco Provincia also cut its rates

, with strong emphasis on business financing.

According to sources from the Buenos Aires entity, since this week the declines for both

working capital credits and check discounting

have been around 40 to 50 percentage points.

For now,

Banco Ciudad

has not come out with a similar measure.

Yes, the Buenos Aires entity

had sharply lowered its rates before the

Central Bank's announcement in a line especially designed for students.

As reported by the City exactly a week ago, this is financing for "broad destinations" that allows access to an

amount of up to $10 million,

for a term of up to

48 months

and with a new promotional

fixed rate

of

66%

TNA.

"These loans allow the figure of the guarantor for those who do not have their own income and are complemented with specific banking services, benefits and exclusive promotions," they explained.

The strong liquefaction of the remunerated liabilities of the Central Bank that Luis Caputo and Santiago Bausili faced three months ago completely changed the business of the banks that for years had stopped lending to the private sector to finance the Central via leliq.

However, the entities said that the three-digit rates that governed the economy until Tuesday "did not allow" them to think about expanding the supply of credit to families and individuals.

One of the arguments they gave was that, with the fixed term rate stuck at 110% annually,

the cost of "capturing" pesos and then lending them was still expensive for the banks

.

Therefore, the "liberation" of the minimum rates carried out by the Central Bank this week could unblock this issue.

On Tuesday morning, most

private entities

were quick to adjust their systems to reduce annual

placement

yields to a level

between 75% and 70%

.

However, they took their time to inform their customers of a similar drop in loan rates.

Above all, they waited to know the inflation data that the INDEC finally communicated in the order of 13.2%.

In a private entity they announced that the rate will go down "a lot." "The drop will be in line with the reduction in the transfer rate, or perhaps higher."

In some

homebanking,

these drops have already begun to be seen and, for example,

rates of 86% appear for personal loans.

The reduction in rates should also make fintech

loans cheaper

, which as a general rule have a higher financial cost than in traditional financial institutions.

"There will surely be an impact," they warned on a wallet, although they could not specify the new prices.

The speed of reflexes of the financial sector at this point could be key to reducing in the coming months the fall in private credit, hard hit in recent years: according to data from the consulting firm LCG, the stock of pesos "lent" to families and companies in banks is barely 30% of what was seen in 2018.

NE

Source: clarin

All business articles on 2024-03-14

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