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Colombia’s Financial System Overview

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Colombia’s financial system is a significant contributor to the country’s economy. Here are some key points about the current state of the financial system.

Total Financial System Assets

• Total financial system assets are equivalent to close to 150% of GDP.
• This indicates a strong presence of financial institutions in the country.

Banking System Concentration

• The largest four banks account for about 60% of banking system assets, highlighting a high level of concentration in the industry.
• One group, Aval, owns four banks, including the second-largest bank, demonstrating further consolidation in the sector.

Regional Operations

• Colombian banks have a significant presence in Central America, with combined market shares of:
  • 54% in El Salvador
  • 27% in Panama
  • And so on.
• Grupo Suramericana is considered a regionally systemic insurance group, further expanding the country’s financial influence.

Financial Conglomerates

• The three largest domestically-owned banking groups are part of mixed-function conglomerates with significant financial activities beyond banking.
• These conglomerates have consolidated assets totaling around 20% of GDP, emphasizing their substantial contribution to the economy.

Systemic Importance

• The four largest banking groups are considered domestically systemic due to their size, but there are no explicit additional supervisory or regulatory requirements for systemic firms.