Mexico Bank Regulator Says Loans to Grow 15% This Year

Mexican banks’ outstanding loans are likely to grow by at least 15 percent this year, according to the head of the nation’s banking and securities regulatory agency.

“We expect a relatively good year,” Guillermo Babatz, president of the National Banking and Securities Commission, said in an interview at Bloomberg’s Mexico City office. “They’re going to be growing all across the board.”

Mexican banks’ total outstanding loans rose 15 percent in nominal terms in June from the same month a year ago to 2.58 trillion pesos ($196 billion), according to CNBV, as the banking and securities regulator is known.

Outstanding consumer loans rose 24 percent in June, compared with the same period in 2011, according to the agency. Babatz said bank loan growth this year will include expansion in lending for housing, businesses, government and consumers.

The forecasted loan growth would be more than four times the 3.7 percent that economists surveyed by Bloomberg expect Mexico’s economy to expand this year.

Grupo Financiero Santander SAB, the Mexican unit of Spain’s Banco Santander SA (SAN) and fourth-largest bank by outstanding credit in the Latin American nation, said second-quarter outstanding loans rose 17 percent to 339 billion pesos.

‘Keep Expanding’

“We are going to keep expanding at this pace,” Marcos Martinez Gavica, the chief executive officer of the bank, said at an event in Mexico City on July 26. “We have demand for loans, therefore we are having good results and we are beating the market.”

Grupo Financiero Banamex SA, Citigroup Inc.’s Mexican unit, the country’s second-biggest bank by outstanding credit, sees outstanding loans rising 15 percent this year, Chief Executive Officer Javier Arrigunaga said in Mexico City while reporting second-quarter results July 26.

Babatz, who plans to leave his post when President Felipe Calderon’s administration concludes at the end of November, said regulators need more autonomy and an increased ability to make sanctions public.

HSBC Holdings Plc (HSBA), Europe’s biggest bank, said last month its Mexican unit paid a $27.5 million fine to the nation’s regulators for non-compliance with money-laundering systems and controls. Babatz said Mexican rules prevented regulators from going public with the case until the bank decided to drop the case in court.

“It was actually quite unfortunate that the timing of disclosure of this sanction was chosen by the bank, not by us,” he said. “The most important thing that we need to do is to be able to go out with the findings that we have and to publicize the sanctions.”

To contact the reporter on this story: Ben Bain in New York at bbain2@bloomberg.net; Jose Enrique Arrioja at jarrioja@bloomberg.net

To contact the editor responsible for this story: David Papadopoulos at papadopoulos@bloomberg.net

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