April 01, 2009

Growth in bank lending to individuals and companies in Mexico slowed in February as banks became even more wary of the shrinking economy.Credit to consumers, including credit cards, fell 37.5 percent in February from a year ago, the central bank said on Tuesday.Much of the decline was attributed to Spain's Santander (SAN.MC) and Banamex, the Mexican unit of Citigroup (C.N), which last year moved credit card debt off their books and into specialized lending companies.

Consolidating data from banks and those lending companies, consumer credit fell 11.8 percent in February, year over year, the central bank said.Mexico's banks are considered well-capitalized.They have avoided subprime customers and many of the problems plaguing the financial industry in the United States and Europe.But defaults are increasing as unemployment mounts and more and more Mexicans have difficulty making credit card payments.