Small banks see mixed results in 2010

- Friday, January 28, 2011

Small banks see mixed results in 2010

Results were mixed for Peru's smaller banks in 2010, as some struggled to join the major players in catching the wave of the country's economic growth and ramped-up financial activity.

According to the latest financial information available through securities regulator Conasev, Banco Financiero reported strong results, with its earnings soar by 83% in 2010 to 33mn soles (US$12mn) on more investment income and lower financing costs.

Likewise, Santander's (NYSE: STD) small Peruvian branch managed to recover from the loss it reported in 2009 to report 6.4mn soles in earnings for the year.

Start your 15 day free trial now!

cta-arrow

Already a subscriber? Please, login

SOME SMALL INSTITUTIONS STRUGGLE

Others did not fare so well. Mibanco, the country's leading microfinance lender, reported 97mn soles in earnings, only marginally better than 2009's results, mostly due to surging personnel costs.

Likewise, Banco de Comercio reported only a little less than 15mn soles in earnings, again roughly similar to 2009's results. While Comercio's financing costs dropped, they did not drop as fast as at some larger institutions, meaning the rise in net interest margin was slight.

According to management notes released to Conasev, the bank's ROE stood at 11.8% through the end of December, 120 basis points lower than 2009's indicator.