Friday, December 8, 2023

Banking sector grants credits for RD$98,000 million to tourism in 2022

Dominican banking plays a fundamental role in the development of tourism, through the financing of hotel projects and related businesses, with a credit portfolio that exceeded RD$98,000 million (US$1,750.6 million) at the end of 2022.

The information comes from Annual Report on Banking and Tourism of the Superintendency of Banks (SB), which also reveals an interannual growth of 13.2% in loans to this industry.

With a weighted average interest rate of 7.1%, it registered the lowest financing costs (the general average was 12.5% ​​per year).

In terms of risk, it is the third portfolio with the lowest delinquency in the financial system, with only 0.4% of the overdue debt and a coverage ratio of 3.4.

As a result, credit to this line has remained in constant growth, at an average nominal rate of 9.4% in the last five years.

When segregating the loans by type of currency, it should be noted that 89% of the tourism portfolio is denominated in US dollars and represents 25% of the total portfolio in foreign currency of the financial system.

Multiple banking has a participation of 93.7% in the tourist credit portfolio. In turn, 90.6% of tourism financing is concentrated in the three commercial banks with the largest number of assets.

As of December 2022, tourism received 6% of bank loans and 11.5% of the private commercial portfolio. Similarly, this line records 19,427 unique debtors and 25,319 loans in the financial system.

The report states that, currently, hotels, bars and restaurants represent about 6.2% of the gross domestic product (GDP) and employ 7.8% of the employed population in the Dominican Republic.


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