Peru Banco de Credito sees flat profits

By Dana Ford

LIMA (Reuters) - Peru's Banco de Credito (CRE.LM), the country's largest bank, expects profits to hold "flat" this year against 2008, Chief Executive Walter Bayly said on Monday, as it weathers the global slowdown.

Bayly, who spoke at the Reuters Latin American Investment Summit in Lima, said the bank's total loan portfolio is likely to grow between 10 percent and 15 percent in 2009, down from 27 percent growth a year ago and below his February forecast of between 15 percent and 20 percent.

He predicted a 20 percent rise in the bank's mortgage sector, versus 27 percent in 2008.

"Flat against last year - marginally above if we're lucky," Bayly said about the bank's projected 2009 profits.

Banco de Credito posted a $423.5 million profit in 2008.

Bayly said the bank is planning to invest $60 million in Peru this year, mostly in the development of a new data center. After opening some 70 new branches last year, the bank is planning to open just a dozen in 2009.

"The corporation's profits will grow because of the other subsidiaries, not because of the bank this year," he said, referring to expected expansion at Credicorp (BAP.N) (BAP.LM), which has a 97.3 percent stake in the bank and is scheduled to announce its first quarter earnings later this week.

Bayly said he was "very satisfied" with Credicorp's performance in the first three months of this year and that he expects the market will receive the results positively.

Besides Banco de Credito, Credicorp runs an insurance unit, a pension management fund and has assets in Bolivia.

Peru's economy, which expanded nearly 10 percent in 2008, is expected to ease to around 4 percent growth this year as the global slowdown cuts demand for many of Peru's metals exports.

"I think the world is starting to differentiate a little bit more. This crisis is going to hit Latin America a lot less that what it has hit other parts of the world," said Bayly.