ECLAC Report Blasts Mexican Banking Sector

ECLAC, the UN’s Economic Commission for Latin America, has published a damning report on Mexico’s banking sector, concluding that the lack of competition in the market provides conditions for “implicit collusion” by banks to keep consumer charges high. Market regulation has kept out competition in certain areas such as credit cards and checks, leading to banks focusing on profitable consumer lending at the expense of financing business. The market is currently dominated by foreign players such as Santander, BBVA, Citigroup, Scotiabank and HSBC, but the report concludes that this foreign presence in the banking sector has not resulted in increased productivity or efficiency in the local banking system.