Key Insights
As of November 2024, Paraguay’s banking credit market continues to demonstrate robust growth, driven by consistent increases in total credit volume and a notable decline in delinquency rates.
The total credit portfolio grew by 12.1% year-over-year, reaching 167.6 trillion Guaraníes (USD 21.831 billion).
Despite this growth, the system-wide delinquency rate dropped to 2.44%, the lowest level in recent years. Market concentration remains significant, with five banks collectively managing over 70% of the total credit portfolio.
The lowest delinquency rates are observed in institutions such as Zeta Banco (0.75%) and UENO Bank (0.87%), although rankings shift considerably when analyzing delinquency rates by loan type.
Consumer loans maintain the highest delinquency rate at 5.2%, reflecting challenges in personal finance management, while agriculture and agribusiness loans demonstrate stronger performance with rates of 1.0% and 1.1%, respectively.
Market Overview
The Paraguayan banking credit market has experienced sustained growth over the past three years, supported by favorable economic conditions and a resilient financial sector. By November 2024, the total credit portfolio reached 167.6 trillion Guaraníes (USD 21.831 billion), marking a 12.1% increase compared to the previous year. This builds on a growth trajectory of 8.0% in 2022 and 12.6% in 2023. The steady expansion underscores the sector’s capacity to support increasing demand for financing across various economic sectors.
Delinquency levels have improved notably, with the system-wide delinquency rate decreasing from 2.90% in 2022 to 2.44% in 2024. This decline indicates enhanced credit management practices and stronger borrower performance. Despite a growing portfolio, banks have successfully mitigated credit risk, maintaining financial stability within the system.
Market share analysis reveals a concentrated landscape, with five leading banks commanding 70.1% of the total credit portfolio. Sudameris Bank leads with an 18.5% share, followed by Banco Continental (17.6%), Banco Itaú Paraguay (13.6%), Banco GNB Paraguay (10.6%), and Banco Nacional de Fomento (9.8%). This high level of concentration underscores the dominance of well-capitalized institutions in the sector.
Delinquency rates across banks show considerable variation. Zeta Banco reported the lowest delinquency rate at 0.75%, followed by UENO Bank (0.87%) and Banco Continental (1.09%). The average delinquency rate across all banks stood at 2.44%. It is noteworthy that Sudameris Bank, despite leading in market share, reported a delinquency rate of 2.39%, just below the system average. When analyzing delinquency by loan type, rankings change significantly, reflecting varying risk profiles across financing categories.
A detailed examination of delinquency by loan type provides critical insights into sector-specific risks. Consumer loans exhibit the highest delinquency rate at 5.2%, highlighting challenges in personal finance repayment. Personal services (3.9%), retail commerce (3.8%), and housing loans (3.5%) also report elevated delinquency rates. In contrast, agriculture (1.0%), agribusiness (1.1%), and industrial loans (1.1%) show strong repayment performance, benefiting from stable economic conditions and targeted financial products for these sectors.
The construction and vehicle financing segments both report a delinquency rate of 2.9%, while wholesale commerce and services average 2.4% and 2.2%, respectively. Livestock loans stand at 1.7%, reflecting the relatively stable dynamics of this sector within the Paraguayan economy. Miscellaneous loans, classified under “Others,” have a delinquency rate of 2.1%, consistent with overall system performance.
In conclusion, Paraguay’s banking credit market demonstrates a strong growth trajectory paired with declining delinquency rates, underscoring the sector’s resilience and effective risk management. The performance of individual banks and loan types varies significantly, offering critical insights for stakeholders aiming to optimize credit strategies and mitigate risks in this dynamic financial landscape.