Amid a tough economic backdrop and a heavily regulated banking industry, Banco Macro shines brightly among Argentine banks. 

“This was a bank that was almost nothing before the crisis and now it’s somebody,” says Franklin Santarelli, former head of Latin American financial institution ratings at Fitch, pointing to the bank’s growth in market share and strong capitalization. 

Still, Macro has not been immune to the domestic troubles. Fitch downgraded the international rating of Macro, along with other financial institutions in Argentina, in August last year, following a cut to the sovereign rating. Despite the lower rating, Fitch noted that Macro’s strong capital base and projected earnings meant that non-performance risk on its 2036 subordinated notes was low.

Banco Macro targets small and medium-sized companies and low to middle-income customers. Impaired loans came to less than 2% of its portfolio and reserve coverage was about 1.5 times as of July. Its retail deposit base, its main source of funding, has increased at a similar pace to its loan portfolio. Customer deposits comprised 85% of total liabilities, while the bank’s liquid assets covered 39.5% of total deposits as of March this year, according to Fitch. 

“From the last crisis until today, Argentina has been through a difficult time,” Santarelli says. “To be able to capitalize and make it through that volatility and bring a bank that is compatible with banks that have been operating in Argentina for hundreds of years, it’s quite an achievement.” LF

WINNER: Banco Macro