Saturday , January 28 2023

In Mexico, the fall in bank fees will be negative: Fitch Ratings


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CDMX. November 10, 2018 Ricardo Montreal, The coordinator of the Moreno stand Senate of the Republic, proposed a draft law that regulates the proposed fees this week banks.

In its report, Fitch Ratings believes that if approved by the initiative, it will have a "negative" impact in medium and long-term prospect for credit institutions with affiliates in Mexico.

The Montreal Recommendation sets out the cancellation of some of the commissions introduced by the banks to the Republic of Mexico; however, Mexico's return on international banking service Fitch Ratings is related to banks' free float control.

"Profitability of Mexican banks can be reduced if approved by the initiative. Monetary Income is an important source of benefits for Mexican banks. These revenues have been around 18 percent of the bank's total operating profit for the last 5 years, while net interest income is still the bulk of total revenues, said Fitch Ratings.

The rating agency believes that this freedom of payments is a "good" option for banks, as most of their income depends on them, while commissions make profits and allow them to stay at low interest rates even in unfavorable conditions.

"It can have a medium and long-term impact on efforts to strengthen mediation and access to finance in Mexico. In addition, it may adversely affect the terms and conditions of the financial products "– said the rating agency.

Político MX, López Dóriga Digital and La Jornada.

La Silla Rota photo.

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