Research and Markets: Colombia Commercial Banking Report Q4 2009 - Includes Independent Forecasts and Competitive Intelligence on Colombia's Commercial Banking Industry

• Press Release
• Source: Research and Markets
• On 10:00 am EST, Monday November 2, 2009

DUBLIN--(BUSINESS WIRE)--Research and Markets (http://www.researchandmarkets.com/research/308f40/colombia_commercia) has announced the addition of the "Colombia Commercial Banking Report Q4 2009" report to their offering.

This Colombia Commercial Banking Report provides industry professionals and strategists, corporate analysts, banking associations, government departments and regulatory bodies with independent forecasts and competitive intelligence on Colombia's commercial banking industry.

The publisher now rates 59 banking systems, and it is little surprise that the developed states dominate the top spots. The US and UK come first and second place, respectively, with scores of 88.7 and 88.0 out of 100. Of crucial importance to both scores is the very high rankings in the crucial 'Risks to realisation of returns - Market structure' sub-category, which accounts for 42% of the overall score. The two countries are ranked first and second in this category as well. This sub-category captures the size of the sector, and the potential for assets and loans to grow in US dollar terms. While both systems have been buffeted by the global credit crunch and will not post stellar growth numbers in percentage terms for the foreseeable future, the sheer size of the US and UK's financial systems means that there is massive potential for deposits, assets and client loans to rise. In addition, the generally solid institutional framework - which looks set to be augmented with new post-credit crunch regulations - will continue to provide a firm basis for the sector.

A Mixed Bag For The Developed States Following just behind the US and UK are a clutch of major developed state economies, including France (82.9, 3rd) and Germany (80.5, 4th globally), Canada (79.9, fifth), as well as Australia and Italy (78.4, joint sixth). All of these sectors have reasonable prospects into the medium term, having a large deposit and loan base, as well as the potential to grow substantially in volume (even if not percentage) terms. However, several states are notable by their absence in this cluster. Austria falls somewhat short (72.4, 12th) of the pack, along with Greece (69.4, 16th), but it is the poor performance of Switzerland (62.7, 26th) and Japan (56.3, 34th) which really stands out. Both states are going to struggle to post increases in asset or loan growth in US dollar terms over the forecast period, to 2013, partially as a result of currency moves to the downside, but also in the case of Switzerland because of the relative weakness of the two key banking groups, UBS and Credit Suisse which had built up large franchises during the good years.

Asia Rising Significantly, just behind the main 'pack' of European economies, several Asian states have managed to post strong performances in their risk ratings. Malaysia (72.1, 11th) and Singapore (77.1, 8th) come in ahead of Austria. However, Singapore leads the world globally in the 'Risks to realisation of returns - Country risk' sub-category, with a score of 84.0, while South Korea has a score of 64.0. Singapore's high score rests on good scores for key elements of BMI's economic, political and business environment risk ratings, which measure the risks to policy continuity. In contrast, the small size of the economy and banking sector is a major factor limiting the potential for expansion, especially in a world of lower liquidity and risk appetite. South Korea, however, has a large domestic economy to provide the deposit base necessary to fund credit growth.

Elsewhere in Asia, The publisher notes that China (overall score 75.1) ranks 9th overall. As the world's third biggest economy - and still an emerging one at that - it is little surprise that the scope for asset growth in China is huge. This has allowed the country to be ranked fourth in the 'Limits of potential returns' category (74.0), and post the highest 'Limits of potential returns - Market structure' sub-category score, at 90.0. What prevents China from rising any higher is its poor performance in the 'Limits of potential returns - Country structure' sub-category, at 57.5 (42nd), and the 'Risk to realisation of returns category', at 80.0 (9th). Of particular concern to BMI is the potential for a collapse of the local system, because much lending is still state directed and risk management is still embryonic. In addition, despite the size of the whole economy, per capita GDP remains low. The publisher forecasts it at US$3,024 for 2009, with significant income inequalities. This severely limits the ability of financial institutions to sell premium products in the local markets, and also means that average deposit levels are still very low.

Emerging Europe, Limited Opportunities The emerging European states are posting surprisingly mediocre ratings outturns. The publisher highlights the potential for a systemic crisis in the region as the major Western European banks removing credit and capital from Central and Eastern Europe. These risks are exacerbated by the deep recessions The publisher sees in the Baltic states, Bulgaria, Russia and Turkey, and the risks of further currency crises that could create even greater economic dislocations, as the massive economic asymmetries that have built up in the region unwind. When taken in tandem with the relatively small size of the local economies and the rapid banking sector expansion seen in recent years, it is little surprise that the highest rated emerging European state is regional heavyweight Russia, at 73.8 (10th globally), and that the top 'new' EU member is the Czech Republic, at 64.5 (24th). Coming close to the bottom of both the regional and global peers groups are Latvia (39.0, 55th) and Ukraine (43.0, 51st), which have both been forced to tap the IMF and EU for emergency funds.

Key Topics Covered:

• Executive Summary
• SWOT Analysis
• Competitive Landscape
• List Of Banks
• BMI Banking Sector Methodology

Companies Mentioned:

• Bancolombia,
• BBVA Colombia,
• Banco Santander
• Colombia,
• Grupo Aval: Banco de Bogotá
• Banco Popular
• Banco AV Villas
• Banco de Occidente, Banco Davivienda

For more information visit http://www.researchandmarkets.com/research/308f40/colombia_commercia

Research and Markets
Laura Wood, Senior Manager,
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