Banking in Bolivia in 2024: The BCB Takes a Greater Role
Bolivia is facing a progressive economic crisis that is increasingly reflected in its financial system. The banking sector’s balance sheet expanded by USD 1.443 billion in 2024, driven by an increase in local currency liquidity and a slowdown in credit portfolios (5% annual). Banks have increased their liquidity by shifting funds from temporary investments to cash holdings, while their dependence on the Central Bank of Bolivia (BCB) continues to rise. Deposits are still growing, albeit at a slower pace. Non-performing loans have slightly decreased to 3.2%, but remain elevated, with 15% of the portfolio still under restructuring. Profitability is gradually improving but remains below pre-pandemic levels. However, persistent macroeconomic fragility—marked by twin deficits, a dollar shortage, and high inflation—poses significant risks to the financial sector’s stability and its ability to fund the real economy.
Feb 21, 2025
