By Mercedes Alvaro
QUITO--Twenty-three private banks operating in Ecuador, along
with the state-run Banco del Pacifico, posted a combined $285
million net profit for the January-October period, up 27% from the
year before, the Banking Superintendency, the country's banking
regulator, said.
According to official data, assets in the banking system totaled
$32 billion in the January-October period, while liabilities were
$29 billion.
During the period, Banco del Pichincha CA (PCH.GU), Banco de
Guayaquil and Banco del Pacifico topped the list, with $62 million,
$42 million and $36 million in earnings, respectively, according to
the report.
The three banks accounted for 49% of the reported combined
income and 53% of Ecuador's banking assets.
Another 7% of the reported income came from foreign banks, like
Citigroup Inc. (C), Dutch-German Procredit and Panama's
Promerica.
Since 2007, when President Rafael Correa took office, banks in
Ecuador have been affected by new regulations, taxes and
constitutional changes that have reduced their profitability and
have caused a slowdown of several indicators, including loans.
According to latest available data from the Private Banking
Association of Ecuador, or ABPE, the nation's banks had return on
equity of 10.15% in 2013, compared with 12.79% in 2012, 18.91% in
2011 and 14.32% in 2010.
Last month Fitch Ratings assigned a negative outlook to the
Ecuadorean banks, saying that a difficult operating environment
fueled by political and regulatory uncertainty is the most
significant factor affecting Ecuador's banking sector.
"These challenges continue to constrain the Ecuadorian banking
system's performance amid favorable macroeconomic conditions such
as all-time low inflation and unemployment," Fitch said.
Write to Mercedes Alvaro at mercedes.alvaro@wsj.com
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