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BBVA Bancomer: After slack in 2017, credit growth in Mexico to pick up in H2'18

Credit to Mexico's private sector will recover in the second half of 2018 after showing sluggishness last year, El Economista reported, citing BBVA Bancomer SA Institución de Banca Múltiple Grupo Financiero BBVA Bancomer Chief Economist Carlos Serrano.

The moderation of credit growth in 2017 was due to the population's lower purchasing power as an effect of faster inflation. The three main loan segments — corporate, consumer and housing — all experienced slower growth last year, and BBVA Bancomer expects the trend to continue in the first half of 2018.

However, Serrano said Mexican inflation is expected to continue its downward trend in the second half of the year, and therefore, people will have more purchasing power.

"We think that this lower dynamism with which we closed 2017 will continue in the first half of this year to see an important recovery later," Serrano said. "This, insofar as real wages are recovering due to the return of low levels of inflation," he added.

BBVA Bancomer's delinquency ratio continued to be stable at 2.5% on average in 2017, despite an environment of uncertainty and volatility.

Meanwhile, Serrano said they expect a 4% real growth in loans this year, but warned that the estimate is not exempt from risks from the uncertainty of the NAFTA renegotiation.