Credit Risk - Special Financial Stability Reports - Second Half of 2020
The main purpose of these reports is to monitor the vulnerabilities and risks of the financial system. Opinions and potential errors are the sole responsibility of the authors, and their contents do not compromise the Board of Directors of Banco de la República (the Central Bank of Colombia).
The Special Financial Stability Reports accompany the publication of the Financial Stability Report and provide a more detailed analysis of some aspects and risks relevant to the stability of the Colombian financial system: market liquidity risk, market risk, credit risk, financial burden, loan portfolio, and housing market in Colombia, international indicators, concentration, and competition in the deposit and credit markets, corporate sector surveys, and financial inclusion.
This report analyzes credit risk exposure and the performance of credit institutions (CIs) as of September 2020. The Financial Stability Report for the second half of 2020 noted that although CIs have managed to face the health emergency with solid solvency and liquidity, it is expected for the economic recession to have an impact on the materialization of credit risk. Therefore, it is crucial to carry out a detailed analysis of the evolution of delinquency and risk perception for each type of loan portfolio with the latest available information. Furthermore, since the flow of credit to the economy will play a key role in the expected path of economic recovery, this report also analyzes the credit terms of new disbursements.
