Chile's largest bank Santander Santiago (NYSE: SAN) believes lending in the local financial system will decelerate to 11-12% in 2009 in nominal terms after rising 17-18% so far this year.
"In nominal rates, the market is growing 17-18% today and we expect that figure to decelerate to 11-12% with a significant decrease in consumer and a slight growth for corporations," strategic planning director Raimundo Monge told a conference call.
"[In 2008] we have seen some deceleration in the consumer side and an acceleration in corporate lending as companies are experiencing difficulty to tap funds abroad," he said.
Santander expects to post 20% sustainable ROEs over the next few quarters despite the ongoing financial crisis.
"We should see ROEs in the low to mid 20s as sustainable trend depending on how the economy manages to grow and how quickly inflation comes down," he said.
"We will face a more challenging environment going forward," he said, adding the bank's top line growth will slow prompted by a slower economic environment and falling inflation.
Monge said Santander provision growth should be reduced going forward. Santander has been focusing growth on the higher-end of the consumer market and corporations, which have seen higher funding costs internationally.
In 3Q08, the bank's net income rose 13.3% compared to the same period 2007 to 96.5bn pesos (US$142mn).
Santander Santiago is a unit of Spain's Santander (NYSE: STD).
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