Banking sector grants RD$98 billion in loans to tourism

Dominican banks play a fundamental role in the development of tourism, through the financing of hotel projects and related businesses, with a loan portfolio that exceeded RD$98 billion (US$1,750.6 million) at the close of 2022.

The information comes from the Annual Report on Banking and Tourism of the Superintendency of Banks (SB), which also reveals a year-on-year 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 annum).

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

As a result, credit to this line of credit has grown steadily, at an average nominal rate of 9.4% over the last five years.

When loans are segregated by type of currency, it is worth noting that 89% of the tourism portfolio is denominated in US dollars and represents 25% of the total foreign currency portfolio of the financial system.Waterfront Buildings

Commercial banks have a 93.7% share of the tourism loan 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. Likewise, this line registers 19,427 unique debtors and 25,319 loans in the financial system.

The report states that, currently, hotels, bars and restaurants represented close to 6.2% of the gross domestic product (GDP) and employs 7.8% of the employed population in the Dominican Republic.

Source: Mitur.gob.do

Learn More: ECONOMY

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