Mexico's Banorte posts 14% profit increase

27 April 2007

Mexican bank Grupo Financiero Banorte has reported a 14 per cent increase in net profit for the first quarter of 2007, compared with the same period of last year.

The largest publicly traded bank in Mexico has announced that net income over the first three months of the year rose from 1.423 billion pesos for the first quarter of 2006 to 1.623 billion pesos (£74.18 million).

Banorte claims that the sharp rise in Q1 2007 profits, in excess of expectations, was the result of a 24 per cent increase in lending over the period. Accounting rule changes and the purchase of a 70 per cent stake in Inter National Bank in the US also affected the quarterly results.

Based in Monterrey, Mexico, Banorte has witnessed rapid growth in credit card uptake in the country and recently launched a new scheme that helps customers transfer balances from rival cards.

"The pace of domestic demand growth isn't slowing along with the economy," Bloomberg quotes Banorte chief executive officer, Luis Pena Kegel, as saying.

"Many people who didn't have credit or didn't keep savings at a bank are joining the banking system."

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