Banks relieved at early signs of recovery. (banks in Puerto Rico) (Industry Overview)

Economic growth promises to bail out numerous banks with faulty loans; slight upturn in lending activity reported

For Puerto Rico's banking industry, the early signs of an economic recovery on the island could not have come at a better time. (See from page story in this issue.)

"Another month or two of recession would have meant big losses at several (local) banks that have numerous commercial loans on the edge," said one banking executive. "At least now they can hold on until the recovery gains more strength." A healthier economy allows borrowers who may be behind on their loan payments to catch up, and it gives banks new lending opportunities.

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