Elektra Tumbles After Reporting Jump in Loan DelinquencyDanielle Verbrigghe and Crayton Harrison
Grupo Elektra SAB, the retail and banking company controlled by billionaire Ricardo Salinas, dropped the most since April after it reported the highest loan delinquency rate in three years.
The stock sank 11 percent to 520.91 pesos at the close of Mexico City trading. Mexico’s benchmark IPC index slid 0.6 percent.
Elektra’s loan delinquency rate was 7 percent at the end of the fourth quarter, the highest level since 2009. The banking unit had 18.4 million active credit accounts at the end of the quarter, up 46 percent from the previous year.
“The ample number of clients is an important sign of strength for the bank, since it reduces credit risk even more,” Elektra said in a report. The company, which doesn’t hold quarterly conference calls for investors, didn’t say why delinquency rates increased.
Fourth-quarter profit fell 87 percent from a year earlier to 1.52 billion pesos ($120 million), the Mexico City-based company reported. That included a non-cash charge of 14.8 billion pesos to reflect the decline in financial instruments that Elektra owns.
Elektra named Mario Gordillo as chief executive officer this week, replacing Carlos Septien.