Chilean state bank BancoEstado aims to maintain similar loan and client growth in the small business segment next year as in 2008 despite the impact from the global financial crisis, small business manager Ricardo Auad Salvador told BNamericas.
BancoEstado grew lending to small businesses at approximately 20% this year and over the last years it has increased the number of small business clients by an annual average of 1,200-1,300, the executive said.
When closing the books the bank expects to finish this year with 26,000 small business clients and a loan portfolio in that segment of around 435mn pesos (US$678,717), Auad said.
The 2009 growth targets for the small business segment will now be evaluated on a quarterly instead of an annual basis because of the uncertainty over how much the Chilean economy will grow next year, he added.
The priority for BancoEstado next year is to ensure small businesses have sufficient liquidity and access to financing so they can continue to pursue new business projects, the executive said.
On the financing side, the bank recently made available a new credit line worth US$1bn for micro, small and medium-sized companies for financing of working capital and investments.
Due to today's difficult times BancoEstado will support all companies in those three segments - clients and non-clients - that have viable business projects that need financing, Auad said, adding that the viability of those projects is fundamental because the bank's loan loss risk in the small business segment is likely to increase next year.
Back in 2002, the bank had less than 10,000 small business clients and a loan book of approximately 100mn pesos. Auad attributed the strong growth BancoEstado has had since then to its tailor-made strategies for the micro, small and medium-sized company segments.
The small business strategy includes specialized business platforms at 66 of BancoEstado's 340 branches across the country; bank executives spending considerable time in the field, visiting small business owners; and tailor-made products and services for that segment, the executive said.
Chilean banks usually serve small and medium-sized businesses as one and the same segment and then their focus tend to be more geared towards the medium-sized companies, Auad added.
BancoEstado is Chile's only state-run bank and it is the country's third largest bank in terms of loans.
