November 1, 2009
And for the most part, Mexican banks have indeed maintained a comparatively solid footing despite the nations deepest recession in decades and job losses that will likely surpass 1 million in the formal sector alone this year. But while Mexican banks turned out to be healthier than their US counterparts, the recession is still causing plenty of pain. In a late September report, Fitch says the outlook for Mexican banks has rapidly worsened in recent months. The agency predicts deteriorating earnings due to the sharp macro downturn, which in turn greatly reduces the pool of eligible credit consumers. Fitch also cites lower interest rates that slash net interest incomes, as well as new re
Since the collapse of Lehman, Mexican authorities have come out repeatedly to defend their nation’s banking system as competitive, profitable and well capitalized.