Financial Stability Report (Dec. 2025): bank liquidity, solvency, non-performing loans and profitability

The Bank of Guatemala published its first Financial Stability Report in December 2025. With data to December 2025 it rates the banking system's Aggregate Risk Indicator as low and reports: medium-term liquidity of 44.9% and immediate liquidity of 19.0%; a Liquidity Coverage Ratio (LCR) above the Basel Committee's 100% minimum in every bank; a Capital Adequacy Index of 15.5% against the 10.0% regulatory minimum; a credit-risk (non-performing loan) indicator that moved from 2.5% in December 2024 to 2.4% (consumer 4.0% to 3.9%, business 1.3% to 1.2%), with provisions of Q15,079.3 million (+12.0% year on year); and profitability of 1.8% on assets (ROA) and 17.8% on equity (ROE), below December 2024 (1.9% and 19.2%). Foreign-currency credit exposure is contained: borrowers who do not earn foreign exchange are 10.9% of the loan book, and resolution JM-46-2004 requires 40 additional percentage points of capital on those exposures. The backdrop helped: S&P (May) and Fitch (October 2025) raised the sovereign rating from BB to BB+ with a stable outlook, Moody's affirmed Ba1, and Guatemala's EMBI spread fell from 203 to 141 basis points between December 2024 and December 2025. The risks the report flags are external: trade and geopolitical tensions, higher funding costs and global financial vulnerabilities.

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