BOGOTA, Jan 22 (Reuters) - Commercial banks’ loan portfolios in Colombia will grow by 6.3 percent this year, more than treble their likely growth in 2017, the banking association said on Monday, as expectations of consumer spending rise.
Portfolio recovery in 2018 will be thanks to low interest rates, increased demand for consumer and commercial credit and economic recovery, Asobancaria, the Colombian banking association, said in a report.
Analysts predict the Andean country will grow 2.5 percent this year, compared to the 1.7 percent estimated for last year.
“Higher growth of productive activities seen for the short and medium-term, in conjunction with monetary conditions that will continue their movement to more expansive territory, will allow a progressive and sustained recovery in confidence and investment,” the report said.
Reductions in income tax under a 2016 reform will also help boost businesses, the report said.
Portfolio growth may not be as high if unemployment grows, there are delays in infrastructure projects or there is lower than expected recovery in investor confidence, it added.
Loan portfolios grew 1.64 percent between January and November last year to 436.4 trillion pesos ($153 million), a sharp fall from 2016’s 6.1 percent growth, figures from the financial regulator showed.
$1 = 2,851.75 Colombian pesos Reporting by Nelson Bocanegra; Writing by Julia Symmes Cobb; Editing by Cynthia Osterman