Publications

As a result of the ongoing tight monetary stance, credit growth trend turned into a deceleration from a moderate path. Higher level of real interest rates result in more restrictive financial conditions. Expected rate cuts in coming months and potential ease in regulatory growth caps might reverse this outlook a little bit.

The Bank of the Republic maintained the policy rate at 9.25% in June, with a divided decision. While inflation showed a marginal reduction and growth continues a gradual recovery, they emphasized the larger estimated fiscal deficit and its effect on the economy and the Bank's interest rate profile.

In April 2025, the fade out of the exchange rate depreciation influenced the lower dynamism of the balance of the current credit portfolio granted by commercial banks to the SPNF (8.2% YoY in real terms) and the balance of traditional bank deposits (6.1% YoY in real terms).

Countries in the region, like Colombia, are developing open finance frameworks. To achieve innovation, competition, and inclusion, it's essential to modernize payments, establish governance that fosters participation, and create robust systems that protect information and customer trust.

The tightening steps of the CBRT in the aftermath of the March shock were followed by much tighter financial conditions and additional macro-prudential measures throughout April and early May. Deposit rates rose to their highest level since Dec24. Credit growth maintains its limited growth.

In March, outstanding credit granted to the non-financial private sector maintained double-digit growth, supported by corporate lending. Traditional banking deposits growth (sight+term) accelerated aunderpinned by public sector resources.

China’s banks face headwinds in 2025 amid weak credit growth, low profitability, and property sector stress. Narrowing interest margins and declining lending rates have pushed ROA and ROE to record lows. Real estate woes, LGFV debt, and US tariffs weigh heavily on the sector, while links to shadow banking grown modestly.

On the back of both internal & external shocks, the CBRT hiked the ON lending rate to 46% and squeezed TL liquidity in March. With the tightening steps, credit growth decelerated and the increased funding costs are expected to weigh on the 2025 profitability of the sector.