Bolivian Banks Achieve Significant Profitability and Asset Growth

Bolivia‘s banking sector has showcased remarkable financial health in the first quarter of 2025, reporting substantial profits and asset expansion. According too the Association of Private Banks of Bolivia (Asoban), banks collectively earned $36 million in profits, marking a 15.9% year-over-year increase. This growth underscores the sector’s resilience and its crucial role in supporting the nation’s economic activities.

Key Performance Indicators highlight Sector Strength

Several key indicators reflect the banking sector’s strong performance:

• Asset Growth: Total assets reached $3,336 million, indicating increased financial capacity.
• Loan Portfolio Expansion: The loan portfolio grew by 5.4%, demonstrating active lending and investment.
• Return on Equity (ROE): the ROE improved to 8.1%, up 0.5 percentage points from march 2024, showcasing enhanced profitability.

These figures suggest that Bolivian banks are not only growing but also becoming more efficient in utilizing thier resources to generate returns. This is particularly vital in a developing economy where financial stability is paramount.

In the first quarter of 2025, the bolivian banking sector maintained a growth trajectory, consolidating its role as a pillar of stability and economic development in the country. This performance was accompanied by a continuous process of patrimonial strengthening, with a heritage that reached 3,336 million dollars, a reflection of the reinvestment of profits and the solidity of the banking entities.
Asoban

Loan Portfolio Dynamics: Business and Microcredit Lead the Way

The banking system’s loan portfolio demonstrated significant dynamism, reaching $29,462 million by March 2025. This represents a 5.4% increase compared to the same period in 2024, translating to an additional $1,513 million in loans disbursed over twelve months.

Specifically, business loans experienced a notable surge of 12%, indicating strong investment activity among Bolivian enterprises. Microcredit also saw a healthy increase of 6.4%, reflecting the sector’s commitment to supporting small businesses and entrepreneurs.

In comparison, the housing mortgage portfolio experienced slower growth, particularly in the social interest housing segment. This is attributed to fixed interest rate regulations that do not adequately reflect prevailing risk conditions, possibly deterring investment in this area.

Public Deposits Surge, Driven by savings and Demand Accounts

Public deposits in bolivian banks grew by 5.6% year-on-year, reaching $31,524 million.This growth was primarily fueled by increased activity in sight deposits and savings accounts, indicating a greater preference for using the national currency. The year-on-year increase amounted to $1,666 million compared to March 2024, highlighting the public’s confidence in the banking system.

Looking Ahead: Maintaining Stability and Supporting Economic Growth

The Bolivian banking sector’s strong performance in the first quarter of 2025 sets a positive tone for the remainder of the year. By maintaining a focus on prudent financial management, reinvesting profits, and adapting to evolving market conditions, Bolivian banks can continue to play a vital role in supporting economic growth and stability in the country.