Multiple banking attracted 4.713 billion dollars of Foreign Direct Investment (FDI) in Mexico during the first quarter of 2024.

What services does commercial banking offer? A variety of financial services, such as loans, credit cards, savings accounts, investment management and insurance. 

In all of 2023, these banking institutions received US$6.029 billion, down from a record US$6.718 billion in 2008.

Multiple banking

In Mexico, commercial banking is the most important sector in the granting of credit. 

Its main function is financial intermediation: to capture funds from the saving public and channel them to those who require financing. 

In both cases, an interest rate is established in exchange for the funds.

From January 2006 to March 2024, it attracted 61,148 million dollars of FDI.

Regulation

According to Mexico’s Ministry of Finance and Public Credit (SHCP), at the end of March 2023, the capitalization index (ICAP) of the multiple banking sector was 19.3%, compared to 19.7% at the end of March 2022 and 19.0% at the end of December 2022.

Under the Credit Institutions Law (LIC), the National Banking and Securities Commission (CNBV) authorizes the operations of commercial and development banks as commercial banks and is responsible for their supervision. 

Risks

The CNBV has the authority to conduct inspection visits and impose sanctions for non-compliance by a bank with the LIC or any regulations derived therefrom. 

Other functions of the CNBV are to supervise financial holding companies, banks and securities dealers and has the power to declare an intervention (managerial intervention) or resolution (liquidation) and to manage a financial group at either the holding company or operating company level.

The CNBV periodically publishes the ICAP. 

The ICAP of commercial banks is the ratio of their net capital compared to their assets weighted by credit risk, market risk and operational risk and is intended to measure the resilience of the institutions in the event of unexpected losses.