‘The moment is challenging and the banks are a reflection of it’

Mario Pardo Bayona has been the president of BBVA Colombia since February 2020 and is the president of the Board of Directors of Asobancaria, which between today and Friday, June 7, is holding the 58th Banking Convention in Cartagena.

The manager has worked with the BBVA Group since 2008.

How did 2024 begin for the bank in Colombia and what expectations are there?

The beginning of the year is being very challenging. From a macroeconomic perspective we are experiencing very low growth and banks are a reflection of what is happening in the economy, we are a very cyclical sector and BBVA is no exception and that is why we see a very complicated start to the year. But it is also true that we see the rest of the year with optimism because we expect a progressive recovery in the following months and in this way, in the financial sector and, of course, in BBVA.

(More: 94.6% of adults had a financial product in 2023).

How has the quality and growth of the bank’s portfolio evolved?

The quality of the portfolio and growth has been poor at the beginning of the year, a reflection of the economic situation. We still have very high interest rates that are making the dynamics of the quality of the portfolio and its growth still very weak, we hope that as interest rates go down, both the quality of the portfolio and the growth dynamics will improve in the coming months.

Which portfolio is being more dynamic?

Although growth is low in all segments, in the housing and payroll portfolio we are seeing positive figures unlike others that are decreasing.

How is the development of green products going?

Until April, we mobilized $2.2 billion in financing for initiatives, on the one hand, that seek to mitigate the impact of climate change and environmental conservation and the development of educational, basic sanitation and health infrastructure. The goal in 2024 is to mobilize at least 30% more resources to execute these initiatives with which we seek to contribute to the construction of a more just and inclusive society.

(More: BBVA mobilized resources for large Colombian companies for more than US$3 billion).

Apart from the reactivation of credit, what else can contribute to boosting the economy?

Apart from interest rates, we can gradually recover confidence and for that we must all be able to reduce the noise to the issues that currently occupy the national agenda and that we try to seek, in a purposeful way, both public sector as a private person, how we can accompany the urgent reactivation.

Do you consider that the Banco de la República rate is still contractionary?

The Bank of the Republic’s rate is very contractionary, the change in real interest rates is more than 400 basis points and that makes it very contractionary. It is also true that although inflation has been falling sharply for many months, we still have relatively high levels and that is why this policy is maintained. We hope that as inflation continues to fall we can have a much less contractionary rate than the current one.

What opportunities and risks do banks face?

Banks are a reflection of the economy and, therefore, our greatest challenge with current very low growth levels and relatively high inflation levels is to ensure that the portfolio stops having a negative dynamic and that its quality do not continue to deteriorate.

The greatest opportunity, clearly, is related to the macroeconomic environment, if we all manage to reactivate the economy this second half of the year and next and return to growth levels of 3%, then the economy will be in a more favorable environment. favorable and the banks too. There we have to be dedicated to accompanying our clients: individuals and companies in their financial needs, to reactivate the economy.

(Also read: Sector unions will give life to the ‘financial university’).

What to do to make the investment rise again?

We need more savings and much more investment to be able to have more sustainable growth over time. It is time to sit down at the table and plan strategies that stimulate long-term investment in Colombia. The Government and the private sector can work together for this, I repeat, there are sectors that require greater attention and we must attend to them, we as a financial entity are willing to do so, but we require lower rates to motivate this investment.

How are you seeing Colombia from the outside?

The BBVA Group is in 25 countries and we see how there are some very challenging aspects. The macroeconomic dynamics are not what we want in terms of employment and inflation, which is why we believe that the short term is very challenging. I want to share a positive message to Colombia, we firmly believe in the country, which has proven many times that it is capable of overcoming any challenge.

HOLMAN RODRÍGUEZ MARTÍNEZ
Portfolio Journalist