Peru Banco Credito sees loans up 30 percent

By Marco Aquino and Terry Wade

LIMA (Reuters) - Peru's Banco de Credito (CRE.LM: Quote, Profile, Research, Stock Buzz), the Andean country's largest bank, expects its loan portfolio to grow by up to 30 percent this year, Chief Executive Walter Bayly said on Wednesday.

Still, portfolio growth may be tempered this year by the central bank, which has twice raised reserve requirements for banks as part of an attempt to control inflation. That has left banks with less cash to lend out.

"I think credit growth will slow in coming months as a result of the measures the central bank has taken," Bayly said, adding that he favors keeping inflation under control.

He said Banco de Credito would invest $150 million building new branches, cash points and on other banking infrastructure this year as it tries to reach new customers. Many Peruvians still don't have bank accounts.

"If the loan portfolio grows 30 percent, our earnings won't grow by that much because we are investing a lot" in banking infrastructure.

Bayly, who spoke at the Reuters Latin America Investment Summit, said Fitch Ratings upgrade of the country to investment-grade status on Wednesday is "extremely important" and will bring in a new era of cheaper, more abundant financing once other credit rating agencies lift their views for Peru.

"This is a sign that the country is protected from any important macroeconomic movement," Bayly said of shocks hitting the global economy.

He said there is a broad consensus in Peru to gradually de-dollarize the economy, where about half of all loans are made in U.S. dollars, to boost overall stability.  Continued...