Credit Crising Coming?

Celent will help qualify your requirements and introduce you to the vendor
Spotted a missing vendor? Use this form to alert a vendor to the Celent service
Create a vendor selection project & run comparison reports
Register to access this feature
Click to express your interest in this report
Indication of coverage against your requirements
Vendor requires PRO subscription to activate this feature
Requires research subscription, contact Celent for more info
19 April 2010
Bart Narter
I was recently in Santiago, Chile and have a very unscientific view of the credit crisis in the US. I see the same thing happening in Chile. Banks are on every street corner in Santiago. The list of banks is impressively long and the branch density is astounding.
  • Banco de Chile
  • Banco de Desarrollo
  • Banco de Credito Inversiones (BCI)
  • Banco Internacional
  • Banco BICO
  • Banco Edwards (Citi)
  • Scotia Bank
  • Citi
  • Banco Falabella (retailer owned bank)
  • Banco Paris (retailer owned bank)
  • Itau
  • Santander (formerly Banco de Santiago)
  • BBVA
On one stretch of street not in a commercial area, but not the center banking area I saw four (4) bank branches in a row on a single street. I don't see this level of bank branch density even in Manhattan. Every single one of these branches was pushing consumer loans. It is true that the demand for loans has increased due to the recent earthquake, but has the ability to repay those loans also increased? It is unwise to ignore the 3 (or 4) C's of credit, as I outline in the Celent report The Banking Crisis: A Back to Basics Lesson December 2008.
  • Capacity (to pay)
  • Character (or Credit history)
  • Collateral
With so many banks pushing so much credit, I can only suspect that these three C's are being ignored in Chile.

Insight details

Sector
Content Type
Blogs
Location
Asia-Pacific, EMEA, LATAM, North America