Latin 100 2004: Strengthened Latin banks start lending

By Celina Vansetti-Hutchins

Methodology | Full results

OVER THE PAST few years, Latin American banking systems have been exposed to much turmoil and sharp challenges, allowing bank intermediation to advance at only a modest pace throughout the region while banks restructured, consolidated, and modernized in line with international guidelines.

Although the region remains highly vulnerable to international volatility, its banking systems are experiencing an across-the-board decline in interest rates. These may initially put pressure on profitability but could eventually increase credit intermediation. Latin American banks are, in the meantime, dedicated to managing their cost bases and expanding client and product reach, in search of economies of scale and market penetration to sustain their profitability.

Supporting such goals are the prospects of improved domestic financial architecture, with an emphasis on the much-needed restructuring of bankruptcy laws, as well as on an implementation of the principles of corporate governance as the banking systems adapt...