Substantial Earnings Growth for Mexican Banks by July 2024

As of July 2024, the collective earnings of Mexican commercial banks reached 171,881 million pesos ($9.5 billion). This signifies a year-over-year real increase of 3.56% compared to July 2023.

The rise primarily stems from heightened interest revenues in a high-rate environment, recording 6.63% growth during this period.

However, there was also a notable 15.36% rise in provisions for credit risks and a 30.72% reduction in earnings from intermediary services, among other financial activities. In July 2023, the sector’s earnings were 157,227 million pesos ($8.68 billion).

Leading the profitability front, BBVA and Banorte remained at the forefront, with BBVA securing 54,549 million pesos ($3 billion), a slight decrease of 0.48% year over year.

Conversely, Banorte saw an increase to 26,488 million pesos ($1.46 billion), marking a 3.38% growth. Other notable banks included Santander and Inbursa. Santander faced a 7.87% decline.

In contrast, Inbursa surged by 31.48%. This significant increase was largely influenced by its recent acquisition of Cetelem.

Furthermore, Citibanamex and BanBajío showed diverse trajectories. Citibanamex earned 14,108 million pesos ($0.8 billion), up by 16.4%, while BanBajío experienced a slight reduction of 3.44%.

Among others, Scotiabank and HSBC collectively contributed to bringing the top eight banks’ earnings to 144,814 million pesos ($8 billion) by July 2024.

The banking sector’s credit portfolio also saw a continuous upward trend with a 4.9% real annual increase, totaling a sector balance of 7.22 trillion pesos ($400 billion). Delinquency rates remained low at 2.01% in July, albeit slightly up from June’s 1.98%.

This financial summary underscores the evolving dynamics and resilience of the Mexican banking sector amid fluctuating economic conditions, highlighting both growth and challenges faced by leading institutions.