Deleveraging well underway, but few signs of financial stress

Our latest Banking Heat Map shows that, while Latin America’s credit bubbles have continued to deflate, this doesn’t yet appear to have triggered widespread problems in the region’s banking sectors. Non-performing loans remain low and have even started to edge down in Brazil, while capital buffers remain adequate elsewhere. That said, the process of deleveraging is still in its early stages and at best will weigh on economic growth for some time to come.