The IMF supported Milei's economic program and dismissed risks from the rise in delinquency in Argentina

The International Monetary Fund referred to the recent increase in delinquency in the Argentine financial system and stated that it does not represent a significant vulnerability. The organization's spokesperson, Julie Kozack, explained that they are closely monitoring the rise in household irregularity rates, although she dismissed the idea that this poses a risk to the sector's stability.

According to the latest official data, payment irregularity reaches 7.7% of the total loans. In the case of family credit cards, it exceeds 12%, and in personal loans, it exceeds 16%. Despite these numbers, the IMF indicated that the overall picture does not generate concern.

Kozack detailed that household indebtedness remains relatively low: around 8% of GDP, a figure lower than that of many other Latin American countries. Additionally, she indicated that banks have good capitalization and liquidity, and that they have provisions covering more than 85% of their loans in default.

“We are monitoring the recent increase in household delinquency rates. We do not consider this to represent a significant financial vulnerability for Argentina,” the spokesperson stated. In the same vein, she recalled that during her recent visit to the country, the IMF director, Kristalina Georgieva, had already pointed out that institutions have tools to manage irregularity.

The spokesperson highlighted that the Government is already working on mechanisms to develop longer-term financing sources. The goal is to consolidate the achievements made in terms of stabilization and growth. “Basically, we observe that household indebtedness in the country remains relatively low,” she argued.

In this context, the IMF praised the stabilization plan of Javier Milei's government. Kozack highlighted the progress in fiscal surplus and in reducing inflation. “Growth has been reactivated, poverty has been reduced, and international reserves are being rebuilt,” she stated.

She also valued the growing market confidence, which translated into a decrease in country risk, improvements in credit ratings, and a growing portfolio of private investment projects. Nevertheless, she acknowledged that there are still pending challenges.

The call to deepen credit

Beyond the diagnosis on delinquency, Kozack emphasized that the Argentine banking system is quite limited. Therefore, she considered it essential to deepen credit markets, facilitating access to financing and channeling Argentine savings towards investments and productive opportunities.