Academic literature on the topic 'Solvency ratios'

This research discuss the calculation of liquidity, solvency and profitability ratios. The liquidity ratio is the ratio that describes the company's ability to meet short-term liabilities, solvency ratio is the ratio that describes the company's ability to meet long-term obligations and the profitability ratio is the ratio that measures the company's ability to generate profits. The aim of this final project is to find out the company's financial condition. The collection of data was used secondary techniques of data in the form of statement of financial position and income statement. The method of analysis used on this study is descriptive analysis method is done by creating a picture and interpret the data relating to fact, circumstances, variable and ongoing events at the time of study. The results obtained after performing the calculation of liquidity, solvency and profitability ratios is the condition of the company based on the liquidity and solvency ratios is in proper and healthy, meanwhile the company is in bad condition based on profitability ratio’s view.

The purpose of this study is to find out how financial ratio analysis to assess the financialperformance of PT. Main Wheel Rays in terms of liquidity ratios, solvency ratios, and profitabilityratios using secondary data. The research method used is descriptive quantitative and independentvariables, namely the company's financial performance measured by several sub variablesincluding liquidity ratios, solvency ratios, and profitability ratios. The results of the research are theanalysis of the ratio of liquidity, solvency, and profitability to assess the financial performance of PT.Main Wheel Rays seen from the liquidity ratio of the company's financial performance are in goodcondition, but too much cash is not used. When viewed from the solvency ratio, the company'sfinancial performance is in a bad condition, because the debt ratio continues to increase. Whenviewed from the profitability ratio, the company's financial performance is in good condition, butmust continue to increase profits.

<span class="fontstyle0">The objective of this research is to examine the effect of financial ratios<br />(proxied by liquidity ratios, solvency ratios, and the ratio of activity) to changes in earnings. Sample used is 55 manufacturing companies in listed in the Indonesian Stock Exchange’s between 2008-2011. Data used were secondary data from annual financial reports. The sampling technique used is purposive sampling method and the model analysis is multiple linier regression. The result indicated that not all independent variables showed significant influence on the dependent variable. Based on this research, solvency ratios and ratio of activity partially influenced to the changes in earnings, where as liquidity ratios doesn’t influence the change in earnings. Liquidity Ratios, Solvency Ratios, and Activity Ratios are used together have a significant impact on the change in earnings.</span>

The relationship between stock prices and financial ratios of the listed companies has been analyzed in differnet contexts - the studies are carried out on companies in different sectors with different financial ratios at different periods. Therefore, as market conditions change so rapidly, there is a need to resume research on this topic. There were selected ratios from the each financial ratios group that may have a relationship with the stock prices. The analysis was implemented by using the data of Lithuanian milk processing companies listed on the Baltic stock exchange over the period from 2010 to 2017. Correlation analysis was performed to determine which financial ratios influence the stock prices. The statistical significance of the relationship between the stock prices and the fixed asset turnover and absolute short-term solvency (the increase of the fixed assets turnover and absolute short-term solvency ratios decrease the stock prices). Spirmen correlation coefficient was calculated for each company individually. The results of the correlation analysis were based on a statistically significant linear multivariate regression model, which describes how the stock prices depend on the fixed asset turnover and short-term solvency ratios: the higher turnover of the fixed assets and short-term solvency ratios – the lower stock prices.

The motivation of this research is research (Rosini & Gunawan 2018; B.Batchimeg 2017). In addition, the motivation of this study also continued the research of Sayekti Suindyah Dwiningwarni (1997). The purpose of this study (1) to analyze the development of corporate financial performance from solvency and profitability ratios; (2) to analyze the measurement of the company's financial performance using solvency and profitability ratios. This research uses quantitative descriptive analysis method.The results of the study (1) the development of the company's financial performance in terms of solvency ratios experienced good development, this is indicated by the value of the solvency ratio that is getting better / better in fulfilling both short and long term obligations; (2) the development of the company's financial performance in terms of profitability ratios from experiencing good development, this is indicated by the value of the profitability ratio that is getting better / better in generating profits or profits; (3) measurement of company performance in terms of solvency ratio shows solvable conditions, meaning the assets is greater than the debt. (4) measurement of company performance in terms of profitability ratios shows good conditions, meaning the level of profits obtained from year to year has increased. This means that the company is in good financial condition and sovabel.

This study aims to analyze 1) Does the liquidity ratio affect stock returns on LQ45 companies listed on the Indonesia Stock Exchange Period 2014-2018, 2) does the solvency ratio affect the stock returns on LQ45 companies listed on the Indonesia Stock Exchange 2014-2018 Period, 3) Does the profitability ratio affect the company in returning shares to LQ45 companies listed on the Indonesia Stock Exchange. Causality design was used in this study. Secondary data used by the author is sourced from financial statement data, publication date, LQ45 companies listed on the Indonesia Stock Exchange in the 2014-2018 period were obtained from the website www.idx.co.id. Based on the results of the study found Liquidity ratios have no effect on Return, Solvency Ratios have no effect on Stock Returns, Profitability Ratios have no effect on Stock Returns and together Liquidity Ratios, Solvency Ratios and Profitability Ratios have a significant effect On Stock Returns.

The performance assessment of the financial aspects of the company more frequently using financial ratio analysis techniques. This analysis requires the financial statements at least the last two years. With the financial ratio analysis will be able to determine the level of liquidity, solvency, and profitability. A research technique that used is quantitative analysis (nonstatistik). From the research result showed that the ratio of liquidity, solvency, and profitability tends to increase and financing of PT Bank Danamon Indonesia, Tbk was in a healthy state, based on the results of tests performed that financing in PT Bank Danamon Indonesia, Tbk in 2011 increased by 777 962. This is due to an increase in the level of solvency. Increased financing occurs due to the condition of PT Bank Danamon Indonesia, Tbk. in a liquid state when viewed from the level of liquidity.Keywords: Liquidity Ratios, Solvency Ratios, Profitability Ratios, and Financing

This study aims to analyze and assess the financial performance of the pharmaceutical sector manufacturing companies on the Indonesia Stock Exchange in the 2015-2017 period based on liquidity ratios, activity ratios, profitability ratios, and solvency ratios. This type of research uses quantitative research. This study uses secondary data in the form of company financial statements and the determination of samples using purposive sampling technique. The analysis method used in this research is financial ratio analysis. The results of the study based on the overall financial ratios both based on liquidity ratios, activity ratios, profitability ratios and solvency ratios indicate that the Sido Muncul Herbal Medicine and Pharmacy Industry has the best financial performance compared to other pharmaceutical sector manufacturing companies. Keywords: Financial Performance Analysis, Ratio Analysis

This research is entitled Analysis of Financial Statements at the Bappeda Office of West Lombok Regency. The purpose of this study is to find out the 2017-2019 Bappeda Lombok Barat Report using the Liquidity and Solvency ratio. Financial statements are information that describes the financial condition of a company and furthermore this information can be used as a description of the company's performance. Analysis of financial statements in public sector organizations is done by comparing the financial performance of one period with the previous period based on financial statements, there are various types of ratios, namely liquidity ratios, solvency ratios, activity ratios, probability ratios, and growth ratios. The method used in this research is quantitative-qualitative using a deductive approach and analysis using Liquidity Ratios and Solvency Ratios, the current ratio of the Regional Development Planning Agency Office for 2017-2019 shows that in 2014 the current ratio was 667.50% in 2018 it decreased to 592.62 % or (74.88%) then experienced a significant increase in 2019 by 932.84% or an increase of 340.22%. Quick Ratio/Quick Ratio 2017 Quick Ratio/Quick Ratio of 264.91% in 2018 decreased by 170.31% or by 94.61% and then experienced a significant increase in 2019 by 524.25% or by 353.94%. In 2017-2019 based on Solvency Ratio analysis, in 2017-2019 the West Lombok Regional Development Planning Agency was able to pay all its debts then in 2019 it decreased by 0.02 and an average of 0.09%. The results of the calculation of the debt ratio in 2019 decreased by 0.02 and an average of 0.09%.

According to the Environmental Performance Index (EPI), Indonesia is listed at 133, from 180 countries in the world. The Ministry of Environment and Forestry of the Republic Indonesia has established a company performance rating, namely, PROPER, whose assessment aspect is almost equal to EPI such as environmental permits, water and air pollution, and waste management. The purpose of this research is to see the effect of profitability, solvency, and liquidity toward firm value with PROPER rating as a moderation variable. Research was conducted over 45 companies in Indonesia from 2015-2019 using multiple regression analysis. The results showed profitability and solvency had positive significant effect on the firm value. Meanwhile, liquidity had negative significant effect towards firm value. PROPER rating positively moderates the effect of profitability and solvency on firm performance. However, it negatively moderates the effect of liquidity towards firm value.

Коефіцієнтний аналіз (ratio analysis) – невід'ємна складова фінансової діагностики. Фінансові співвідношення (коефіцієнти) дозволяють узагальнити велику кількість вихідних даних і якісно оцінити фінансово-економічний стан компанії. Коефіцієнти структури активів дозволяють оцінити: цільовий економічний капітал; ліквідність інвестованого капіталу; здатність компанії змінювати структуру активів під дією факторів впливу. Основним структурним коефіцієнтом, що характеризує співвідношення активів, є співвідношення необоротних і оборотних активів підприємства (non-current assets structure ratio, NCAR). Цей коефіцієнт розраховується під час вертикального аналізу балансу. Сприятливий діапазон значень залежить від галузевої приналежності підприємства. Якщо в динаміці спостерігається збільшення цього співвідношення, це свідчить про посилення виробничих можливостей підприємства при одночасному зниженні фінансової стійкості. Коефіцієнти платоспроможності (solvency ratios) є індикаторами здатності підприємства погашати свої боргові зобов'язання. На відміну від коефіцієнтів ліквідності, які охоплюють тільки короткострокову заборгованість, коефіцієнти платоспроможності характеризують здатність підприємства погашати як короткострокові, так і довгострокові зобов'язання. Необоротні активи – найменш ліквідна частина активів. Тому з точки зору забезпечення платоспроможності і фінансової стійкості вони повинні бути забезпечені переважно найбільш стабільними джерелами фінансування, тобто власним капіталом компанії. Відношення необоротних активів до чистої вартості (власного капіталу) (Non-current assets to Net worth ratio) (NCANWR) показує, чи дотримується це правило. Коефіцієнт оборотності необоротних активів (Non-current assets turnover, NCAT) визначає ефективність, з якою бізнес використовує свої необоротні активи для отримання доходу. Коефіцієнти рентабельності (прибутковості) (Profitability ratios) характеризують здатність підприємства створювати прибуток. Ця група коефіцієнтів має особливо важливе значення, оскільки прибуток є головним підсумковим результатом діяльності підприємства. Рентабельність необоротних активів (Return on Non-current assets, RONCA) характеризує рівень генерації чистого прибутку (Net income) у розрахунку на одиницю вартості необоротних активів.

This Master´s thesis deals with current financial strategies of the company "ABC s. r. o. ". For the appraisals was used various financial methods of the financial analysis. The results was used then for the suggestion on the field of the improving financial situation in the next period.

This Master´s thesis assesses current financial strategies of the company „ABC, a. s.“. The evaluation was based on results from financial analysis which were essential for the proposition of financial strategies for the following period.

The subject of the diploma thesis is financial analysis of Fire Mutual Insurance Company from the year 2004 to 2008. The thesis consists of two parts- theoretical part and practical part. The theoretical part describes acceptable methods of financial analysis of commercial insurance company. On the basis of specific activities of insurance companies are selected the typical indicators for insurance company. The practical part of the thesis is focused on the application of selected methods of financial analysis for the Fire Mutual Insurance Company.

This Master's thesis deals with current financial situation of non-profit-making organization called Nadeje o.s. For classification were applied some methods of financial analysis, whose results were applied to suggestions for financial strategy in following period.

Bakalauro baigiamajame darbe pritaikyti įvairūs bankroto prognozavimo modeliai bei apskaičiuoti dažniausiai naudojami mokumo ir pelningumo rodikliai, neįeinantys į modelius, tačiau turintys didelę įtaką bankroto prognozėms.
Various bankruptcy prediction models are adapted in this bachelor thesis. Generally used solvency and profitability rates, that are not part of models, but have an impact for bankrupt prediction, had been calculated.

This master’s thesis assess the financial health of the company ORTIKA a.s. in the period of 2002 to 2006 on the basis of selected methods of the financial analysis. It includes proposals of possible solutions of identified problems which should result in the improvement of financial situation of the company in future years.

Cílem této diplomové práce je popsat a zhodnotit různé přístupy používané ke sledování solventnosti pojišťoven. V úvodní části jsou vysvětleny základní pojmy z oblasti pojišťovnictví jako riziko, risk management, pojištění a také jsou zde uvedeny specifika hospodaření pojišťoven a možná rizika působící na pojišťovny. V dalších kapitolách jsou přiblíženy principy jednotlivých přístupů, kterými jsou klasický přístup přes míru solventnosti, RBC přístup a dále z moderních přístupů to jsou simulační modely prezentované metodami DFA a scenario testing. V poslední kapitole jsou popsány připravované projekty regulace solventnosti Solvency II a Swiss Solvency Test. Na závěr jsou zhodnoceny výhody a nevýhody uvedených přístupů a jejich dopad na pojistitele.

Mestrado em Finanças
O objetivo deste estudo é analisar a relação entre a eficiência bancária e algumas das medidas regulatórias do Basileia III. É feita uma apresentação e discussão da eficácia das normas globais de liquidez e capital, recentemente impostas pelo Comité de Supervisão Bancária do Basileia (BCBS - Basel Committee on Banking Supervision). A nossa análise empírica baseia-se em duas metodologias distintas: (i) regressões lineares múltiplas; (ii) um método não paramétrico designado de Análise de Dados em Envelope (DEA - Data Envelopment Analysis). A eficiência no setor bancário é medida a partir de duas perspetivas diferentes - com base em simples rácios contabilísticos e, alternativamente, a partir do conceito de eficiência técnica que consiste na distância relativa a uma fronteira de eficiência padrão. Os nossos resultados apontam para a presença de efeitos da regulação do Basileia na eficiência bancária, embora estes efeitos não sejam consistentes durante os três anos em análise. Os resultados de ambas as metodologias sugerem impactos contraditórios na eficiência dos bancos europeus.
The purpose of this study is to analyse the relationship between bank efficiency and some Basel III regulatory measures. It presents and discusses the effectiveness of recent liquidity and capital global standards imposed by the Basel Committee on Banking Supervision (BCBS). Our empirical analysis relies on two distinct methodologies: (i) multiple linear regressions; (ii) a non parametric method called Data Envelopment Analysis (DEA). The efficiency in the banking sector is measured in two different perspectives - through simple accounting ratios and, alternatively, through the concept of technical efficiency which consists of the relative distance to a best-practice efficient frontier. Our findings point to the presence of effects of Basel regulation on bank efficiency, although these effects are not consistent throughout the three-year analysis. Evidence from both methodologies suggest a conflicting impact on the efficiency of European banks.
info:eu-repo/semantics/publishedVersion

Orientador: Mario Roberto Vizioli
Dissertação (mestrado) - Universidade Estadual de Campinas, Faculdade de Odontologia de Piracicaba
Made available in DSpace on 2018-07-27T11:24:17Z (GMT). No. of bitstreams: 1 Ramos_MabelPhilipps_M.pdf: 4905002 bytes, checksum: f8a62f9d47dd3b1915a675f55703713f (MD5) Previous issue date: 2000
Resumo: O retratamento é a primeira opção para os casos de insucesso da terapia endodôntica. Para que possa ser realizado, é preciso remover o material obturador pré-existente no canal radicular. O uso de solventes facilita este procedimento, além de evitar a ocorrência de acidentes. Um dos requisitos desejáveis é de não serem agressivos aos tecidos periapicais. Sendo assim, a proposta deste estudo foi de avaliar o potencial irritante destes solventes e comparar seus efeitos sobre o tecido subcutâneo de ratos. Para isto, 12 animais foram utilizados, recebendo quatro tubos de polietileno. Três preenchidos com Fibrinol embebido em cada uma das substâncias-teste, ou seja, clorofórmio, eucaliptol e óleo de laranja e um tubo preenchido apenas com Fibrinol que serviu de controle. Os animais foram sacrificados após 4, 7, 11 e 15 dias, com remoção dos tecidos dorsais que continham os tubos. Após processamento laboratorial das peças incluídas em glicol metracrilato, foram realizados cortes de 3 m m de espessura, corados com hematoxilina e eosina e analisados em microscopia óptica. Os resultados obtidos demonstraram que o óleo de laranja foi o solvente menos irritante. Subjetivamente não foi encontrada diferença entre o poder irritante do eucaliptol e do clorofórmio. Sendo assim, acreditamos que o óleo de laranja possa ser a alternativa mais adequada para a desintegração do material obturador durante o retratamento endodôntico
Abstract: Re-treatment is the first option in case of failure of the endodontic therapy. To enable this process, it is essential to remove the pre-existing filling material of the root canal. The use of solvents facilitates this procedure and helps to avoid accidents. One of the properties required from these solvents is non-aggression to periapical tissues. The aim of this study is, therefore, to evaluate the harmful potential of these solvents and compare their effect on subcutaneous tissue of rats. Twelve rats were used to carry out the experiment. Four polyethylene tubes were implanted in each animal, and these tubes were filled with Fibrinol imbibed in one of the test-substances, which were chloroform, eucalyptol, and orange oil. The fourth tube was filled only with Fibrinol and was used as a control. Animals were killed 4, 7, 11 and 15 days after implant procedures, and dorsal tissues contained in the implants were removed. After laboratory processing of the specimens, which were immersed in metacrylate glycol, three 3 mm-wide sections were made. These sections were stained with hematoxylin and eosin, and analyzed through microscopy. The results showed that the least harmful solvent was the orange oil. Subjectively, no difference was found between the harmful potential of eucalyptol and chloroform. We therefore believe that the orange oil may be the most appropriate alternative for disintegration of filling material during endodontic re-treatment
Mestrado
Mestre em Radiologia Odontológica

The book deals with the 1997 Asian currency crisis and analyses the causes and consequences of the crisis.The two hypotheses, fundamental and panic/herd behavior hypotheses, which are often viewed as competing, are also examined. The first hypothesis states that fundamental imbalances triggered the Asian currency and financial crisis in 1997.The crisis occurred because the economies had deteriorating current accounts, a slow down in growth rates and short-term debt approaching a dangerous level; while the second hypothesis states that sudden shifts in market expectations and confidence were the cause of the initial financial turmoil.When the crisis erupted, it caused panic among domestic and foreign investors. The main focus of this book is to evaluate these two approaches and to examine whether there was evidence of insolvency prior to the crisis in four Asian countries namely Malaysia, Indonesia, Thailand and the Philippines. A solvency index, originally popularized by Cohen, is calculated for each country.An analysis of the trade sector is undertaken in which the dynamic OLS is employed. Subsequently, the price elasticities obtained from the export demand model together with the GDP supply elasticity are used to calculate the index. From the analysis, it appears that all countries were solvent prior to the crisis where the percentage of actual debt service paid (in 1997) was greater than the percentage that must be paid to be solvent. This suggests that further external credit could have solved the problem, as it was a matter of short-term liquidity difficulties and panic, rather than insolvency.

Abstract Mortality forecasting has recently received growing interest, as accurate projections of future lifespans are needed to ensure the solvency of insurance and pension providers. Several innovative stochastic methodologies have been proposed in most recent decades, the majority of them being based on age-specific mortality rates or on summary measures of the life table. The age-at-death distribution is an informative life-table function that provides readily available information on the mortality pattern of a population, yet it has been mostly overlooked for mortality projections. In this chapter, we propose to analyse and forecast mortality developments over age and time by introducing a novel methodology based on age-at-death distributions. Our approach starts from a nonparametric decomposition of the mortality pattern into three independent components corresponding to Childhood, Early-Adulthood and Senescence, respectively. We then model the evolution of each component-specific death density with a relational model that associates a time-invariant standard to a series of observed distributions by means of a transformation of the age axis. Our approach allows us to capture mortality developments over age and time, and forecasts can be derived from parameters’ extrapolation using standard time series models. We illustrate our methods by estimating and forecasting the mortality pattern of females and males in two high-longevity countries using data of the Human Mortality Database. We compare the forecast accuracy of our model and its projections until 2050 with three other forecasting methodologies.

In this study we applied the CART-type Decision Tree (DT-CART) method derived from artificial intelligence technique to the prediction of the solvency of bank customers, for this we used historical data of bank customers. However we have adopted the process of Data Mining techniques, for this purpose we started with a data preprocessing in which we clean the data and we deleted all rows with outliers or missing values as well as rows with empty columns, then we fixed the variable to be explained (dependent or Target) and we also thought to eliminate all explanatory (independent) variables that are not significant using univariate analysis as well as the correlation matrix, then we applied our CART decision tree method using the SPSS tool. After completing our process of building our model (AD-CART), we started the process of evaluating and testing the performance of our model, by which we found that the accuracy and precision of our model is 71%, so we calculated the error ratios, and we found that the error rate equal to 29%, this allowed us to conclude that our model at a fairly good level in terms of precision, predictability and very precisely in predicting the solvency of our banking customers.

The financial crisis of 2007-2010 also known as the Global Financial Crisis and 2008 financial crisis, was considered by many economists to be the worst financial crisis since the Great Depression of the 1930’s. It contributed to the failure of key businesses, declines in consumer wealth estimated in the trillions of U.S. dollars, substantial financial commitments incurred by governments, and a significant decline in economic activity. The financial crisis of 2007/08 which began in the United States had little impact on Turkish economy in the beginning stages. However, as a result of the economic downturn in global economics, Turkish economy has been also affected by its domino effect. The aim of this study is to characterize the impact of the 2008 global financial crisis on the financial performance of manufacturing companies listed on Borsa Istanbul, Turkey. Financial analysis will be conducted on 192 publicly listed manufacturing companies. Twelve financial ratios will be examined to determine the profitability, liquidity, activity, leverage and solvency of these companies over the period between 2006 and 2010. A data envelopment analysis will be applied to measure the performance of manufacturing firms before and after the financial crisis of 2008. Findings of this paper may be used by the managements to mitigate the effects and to enhance future performance of these companies have been uncovered. The analysis and observations will be invaluable to researchers intending to study how the manufacturing industry responds to a future slump in demand.

Solvent extraction has been used in industry or many purposes for years, including to recover oil at contaminated soil. Certain solvents and temperature ranges have been chosen to increase the oil recovery rate of extraction process. The Study observed the implementation of biosurfactant at the extraction process to perform reduction of total petroleum hydrocarbon (TPH) concentration of oily contaminated soil. In order to optimize TPH removal, extraction were conducted for multiple stages. Biosurfactant extraction result were also compared to solvent extraction process which acetone and toluene have been selected to extract oil content from contaminated soil by using solvent extraction process. The combination treatments with biosurfactant were also involving variety of centrifugation process with 1000 rpm (1570 g) operational speed. Duration of treatment process was 10 minutes with some variations of solid to solvent ratio. During the experiments comparison result between varies treatment process provides alternatives to treat oily contaminated soil by using extraction process. Compatibility among solvents, biosurfactants, types of oily contaminated solid waste were also observed to seek possibility on large scale of treatment process implementation both insitu at the contaminated site and exsitu at integrated waste treatment facility.

Effective Solvent Extraction Incorporating Electromagnetic Heating (ESEIEH) is a relatively new concept that relies on Radio Frequency (RF) heating and solvents to replace steam in current thermal processes for the purpose of extracting bitumen from oil rich sands. The work presented here will further the understanding of the near wellbore flow and phase behavior of the ESEIEH process in order to better predict solvent vaporization dynamics and heat rates delivered to the pay zone. This numerical study details the aspects of phase change of liquid/vapor systems confined in porous media heated by electromagnetic radiation, and approximated by a volumetric heat source term in the energy equation. The objective of this work is to utilize the numerical methodology presented herein to predict liquid penetration depth in a heated isotropic porous matrix to avoid the over-saturation of liquid solvent in the pay zone. Results demonstrate the sensitivity of the liquid solvent penetration depth to the solvent delivery rate and the resulting temperature.

The tomato, a profitable vegetable crop in both the USA and Israel, has benefited significantly from intensive breeding efforts in both countries, and elsewhere (esp. Holland). : Modem hybrids are highly prolific and resistant to a variety of major pests. They produce attractive, firm fruit for both processing and fresh-marketing. In all cases, however, reduction in flavor and aroma have occurred concomitantly with the increase in yield. Sugars-acids ratio dominate fruit taste, whereas aroma volatiles (potent at minute ppb and ppt levels) contribute to the total characteristic tomato flavor. An increase in sugars (1-2%) contributes significantly to tomato fruit taste. However, because of energy reasons, an increase in fruit sugars is immediately compensated for by a decrease in yield. Our main objectives were to: (a) pinpoint and identify the major impact aroma components of fresh tomato; (b) study the genetic and environmental effects on fruit aroma; (c) determine precursors of appealing (flavors) and repelling (off-flavors) aroma compounds in tomato. Addition of saturated salts blocked all enzymatic activities prior to isolation of volatiles by dynamic and static headspace, using solvent assisted flavor evaporation (SAFE) and solid phase micro-extraction (SPME) from highly favored (FA-612 and FA-624) and less preferred (R 144 and R 175) tomato genotypes. Impact aroma components were determined by gas chromatography-olfactometry (GC-O), gas chromatography-mass spectrometry (GC- MS) and aroma extract dilution analysis (AEDA). The potent odorant (Z)-1,5-octadien-3-one, was identified for the first time in fresh tomato. From the ca. 400 volatile compounds in the headspace of fresh tomato, the following compounds are proposed to be impact aroma compounds: (Z)-3-hexenal, hexanal, 1-penten-3-one, 2-phenylethanol, (E)-2-hexenal, phenyl acetaldehyde, b-ionone, b-damascenone, 4-hydroxy-2,5-dimethyl-3-(2H)-furanone (FuraneolR), (Z)-l,5-octadien-3-one, methional, 1-octen-3-one, guaiacol, (E,E)- and (E,Z)- 2,4-decadienal and trans- and cis-4,5-EPOXY -(E)-2-decenal. This confirms the initial hypothesis that only a small number of volatiles actually contribute to the sensation of fruit aroma. Tomato matrix significantly affected the volatility of certain impact aroma components and thus led to the conclusion that direct analysis of molecules in the headspace . may best represent access of tomato volatiles to the olfactory receptors. Significant differences in certain odorants were found between preferred and less-preferred cultivars. Higher consumer preference was correlated with higher concentrations of the following odorants: l-penten-3-one, (Z)-3-hexenal, (E,E)- and (E,Z)-2,4-decadienal and especially Furaneol, whereas lower consumer preference was associated with higher concentrations of methional, 3-methylbutyric acid, phenylacetaldehyde, 2-phenylethanol, and 2-isobutylthiazole. Among environmental factors (salinity, N source, growth temperature), temperature had significant effects on the content of selected aroma compounds (e.g., 3-methylbutanal, 1- penten-3-one, hexanal, (Z)-3-hexenal, (E)-2-hexenal, 2-isobutylthiazole, 6-methyl-5-hepten- 2-one, 1-octen-3-one, methional, 2-phenylethanal, phenyl acetaldehyde, and eugenol) in fresh tomatoes. Salt stress (20 mM NaCl) increased the content of odorants such as (Z)-3-hexenal, 2-phenylethanol and 3-methylbutanal in the R-144 cultivar whereas salinity had minor effects on 1-pentene-3-one, 2-isobutylthiazole and b-ionone. This fundamental knowledge obtained by comprehensive investigation, using modem chemical, sensory and agrotechnical methodology will assist future attempts to genetically modify the concentrations of key odorants in fresh tomatoes, and thus keep the tomato production of Israel and the USA competitive on the world market.

1.1 Macroeconomic summary Economic recovery has consistently outperformed the technical staff’s expectations following a steep decline in activity in the second quarter of 2020. At the same time, total and core inflation rates have fallen and remain at low levels, suggesting that a significant element of the reactivation of Colombia’s economy has been related to recovery in potential GDP. This would support the technical staff’s diagnosis of weak aggregate demand and ample excess capacity. The most recently available data on 2020 growth suggests a contraction in economic activity of 6.8%, lower than estimates from January’s Monetary Policy Report (-7.2%). High-frequency indicators suggest that economic performance was significantly more dynamic than expected in January, despite mobility restrictions and quarantine measures. This has also come amid declines in total and core inflation, the latter of which was below January projections if controlling for certain relative price changes. This suggests that the unexpected strength of recent growth contains elements of demand, and that excess capacity, while significant, could be lower than previously estimated. Nevertheless, uncertainty over the measurement of excess capacity continues to be unusually high and marked both by variations in the way different economic sectors and spending components have been affected by the pandemic, and by uneven price behavior. The size of excess capacity, and in particular the evolution of the pandemic in forthcoming quarters, constitute substantial risks to the macroeconomic forecast presented in this report. Despite the unexpected strength of the recovery, the technical staff continues to project ample excess capacity that is expected to remain on the forecast horizon, alongside core inflation that will likely remain below the target. Domestic demand remains below 2019 levels amid unusually significant uncertainty over the size of excess capacity in the economy. High national unemployment (14.6% for February 2021) reflects a loose labor market, while observed total and core inflation continue to be below 2%. Inflationary pressures from the exchange rate are expected to continue to be low, with relatively little pass-through on inflation. This would be compatible with a negative output gap. Excess productive capacity and the expectation of core inflation below the 3% target on the forecast horizon provide a basis for an expansive monetary policy posture. The technical staff’s assessment of certain shocks and their expected effects on the economy, as well as the presence of several sources of uncertainty and related assumptions about their potential macroeconomic impacts, remain a feature of this report. The coronavirus pandemic, in particular, continues to affect the public health environment, and the reopening of Colombia’s economy remains incomplete. The technical staff’s assessment is that the COVID-19 shock has affected both aggregate demand and supply, but that the impact on demand has been deeper and more persistent. Given this persistence, the central forecast accounts for a gradual tightening of the output gap in the absence of new waves of contagion, and as vaccination campaigns progress. The central forecast continues to include an expected increase of total and core inflation rates in the second quarter of 2021, alongside the lapse of the temporary price relief measures put in place in 2020. Additional COVID-19 outbreaks (of uncertain duration and intensity) represent a significant risk factor that could affect these projections. Additionally, the forecast continues to include an upward trend in sovereign risk premiums, reflected by higher levels of public debt that in the wake of the pandemic are likely to persist on the forecast horizon, even in the context of a fiscal adjustment. At the same time, the projection accounts for the shortterm effects on private domestic demand from a fiscal adjustment along the lines of the one currently being proposed by the national government. This would be compatible with a gradual recovery of private domestic demand in 2022. The size and characteristics of the fiscal adjustment that is ultimately implemented, as well as the corresponding market response, represent another source of forecast uncertainty. Newly available information offers evidence of the potential for significant changes to the macroeconomic scenario, though without altering the general diagnosis described above. The most recent data on inflation, growth, fiscal policy, and international financial conditions suggests a more dynamic economy than previously expected. However, a third wave of the pandemic has delayed the re-opening of Colombia’s economy and brought with it a deceleration in economic activity. Detailed descriptions of these considerations and subsequent changes to the macroeconomic forecast are presented below. The expected annual decline in GDP (-0.3%) in the first quarter of 2021 appears to have been less pronounced than projected in January (-4.8%). Partial closures in January to address a second wave of COVID-19 appear to have had a less significant negative impact on the economy than previously estimated. This is reflected in figures related to mobility, energy demand, industry and retail sales, foreign trade, commercial transactions from selected banks, and the national statistics agency’s (DANE) economic tracking indicator (ISE). Output is now expected to have declined annually in the first quarter by 0.3%. Private consumption likely continued to recover, registering levels somewhat above those from the previous year, while public consumption likely increased significantly. While a recovery in investment in both housing and in other buildings and structures is expected, overall investment levels in this case likely continued to be low, and gross fixed capital formation is expected to continue to show significant annual declines. Imports likely recovered to again outpace exports, though both are expected to register significant annual declines. Economic activity that outpaced projections, an increase in oil prices and other export products, and an expected increase in public spending this year account for the upward revision to the 2021 growth forecast (from 4.6% with a range between 2% and 6% in January, to 6.0% with a range between 3% and 7% in April). As a result, the output gap is expected to be smaller and to tighten more rapidly than projected in the previous report, though it is still expected to remain in negative territory on the forecast horizon. Wide forecast intervals reflect the fact that the future evolution of the COVID-19 pandemic remains a significant source of uncertainty on these projections. The delay in the recovery of economic activity as a result of the resurgence of COVID-19 in the first quarter appears to have been less significant than projected in the January report. The central forecast scenario expects this improved performance to continue in 2021 alongside increased consumer and business confidence. Low real interest rates and an active credit supply would also support this dynamic, and the overall conditions would be expected to spur a recovery in consumption and investment. Increased growth in public spending and public works based on the national government’s spending plan (Plan Financiero del Gobierno) are other factors to consider. Additionally, an expected recovery in global demand and higher projected prices for oil and coffee would further contribute to improved external revenues and would favor investment, in particular in the oil sector. Given the above, the technical staff’s 2021 growth forecast has been revised upward from 4.6% in January (range from 2% to 6%) to 6.0% in April (range from 3% to 7%). These projections account for the potential for the third wave of COVID-19 to have a larger and more persistent effect on the economy than the previous wave, while also supposing that there will not be any additional significant waves of the pandemic and that mobility restrictions will be relaxed as a result. Economic growth in 2022 is expected to be 3%, with a range between 1% and 5%. This figure would be lower than projected in the January report (3.6% with a range between 2% and 6%), due to a higher base of comparison given the upward revision to expected GDP in 2021. This forecast also takes into account the likely effects on private demand of a fiscal adjustment of the size currently being proposed by the national government, and which would come into effect in 2022. Excess in productive capacity is now expected to be lower than estimated in January but continues to be significant and affected by high levels of uncertainty, as reflected in the wide forecast intervals. The possibility of new waves of the virus (of uncertain intensity and duration) represents a significant downward risk to projected GDP growth, and is signaled by the lower limits of the ranges provided in this report. Inflation (1.51%) and inflation excluding food and regulated items (0.94%) declined in March compared to December, continuing below the 3% target. The decline in inflation in this period was below projections, explained in large part by unanticipated increases in the costs of certain foods (3.92%) and regulated items (1.52%). An increase in international food and shipping prices, increased foreign demand for beef, and specific upward pressures on perishable food supplies appear to explain a lower-than-expected deceleration in the consumer price index (CPI) for foods. An unexpected increase in regulated items prices came amid unanticipated increases in international fuel prices, on some utilities rates, and for regulated education prices. The decline in annual inflation excluding food and regulated items between December and March was in line with projections from January, though this included downward pressure from a significant reduction in telecommunications rates due to the imminent entry of a new operator. When controlling for the effects of this relative price change, inflation excluding food and regulated items exceeds levels forecast in the previous report. Within this indicator of core inflation, the CPI for goods (1.05%) accelerated due to a reversion of the effects of the VAT-free day in November, which was largely accounted for in February, and possibly by the transmission of a recent depreciation of the peso on domestic prices for certain items (electric and household appliances). For their part, services prices decelerated and showed the lowest rate of annual growth (0.89%) among the large consumer baskets in the CPI. Within the services basket, the annual change in rental prices continued to decline, while those services that continue to experience the most significant restrictions on returning to normal operations (tourism, cinemas, nightlife, etc.) continued to register significant price declines. As previously mentioned, telephone rates also fell significantly due to increased competition in the market. Total inflation is expected to continue to be affected by ample excesses in productive capacity for the remainder of 2021 and 2022, though less so than projected in January. As a result, convergence to the inflation target is now expected to be somewhat faster than estimated in the previous report, assuming the absence of significant additional outbreaks of COVID-19. The technical staff’s year-end inflation projections for 2021 and 2022 have increased, suggesting figures around 3% due largely to variation in food and regulated items prices. The projection for inflation excluding food and regulated items also increased, but remains below 3%. Price relief measures on indirect taxes implemented in 2020 are expected to lapse in the second quarter of 2021, generating a one-off effect on prices and temporarily affecting inflation excluding food and regulated items. However, indexation to low levels of past inflation, weak demand, and ample excess productive capacity are expected to keep core inflation below the target, near 2.3% at the end of 2021 (previously 2.1%). The reversion in 2021 of the effects of some price relief measures on utility rates from 2020 should lead to an increase in the CPI for regulated items in the second half of this year. Annual price changes are now expected to be higher than estimated in the January report due to an increased expected path for fuel prices and unanticipated increases in regulated education prices. The projection for the CPI for foods has increased compared to the previous report, taking into account certain factors that were not anticipated in January (a less favorable agricultural cycle, increased pressure from international prices, and transport costs). Given the above, year-end annual inflation for 2021 and 2022 is now expected to be 3% and 2.8%, respectively, which would be above projections from January (2.3% and 2,7%). For its part, expected inflation based on analyst surveys suggests year-end inflation in 2021 and 2022 of 2.8% and 3.1%, respectively. There remains significant uncertainty surrounding the inflation forecasts included in this report due to several factors: 1) the evolution of the pandemic; 2) the difficulty in evaluating the size and persistence of excess productive capacity; 3) the timing and manner in which price relief measures will lapse; and 4) the future behavior of food prices. Projected 2021 growth in foreign demand (4.4% to 5.2%) and the supposed average oil price (USD 53 to USD 61 per Brent benchmark barrel) were both revised upward. An increase in long-term international interest rates has been reflected in a depreciation of the peso and could result in relatively tighter external financial conditions for emerging market economies, including Colombia. Average growth among Colombia’s trade partners was greater than expected in the fourth quarter of 2020. This, together with a sizable fiscal stimulus approved in the United States and the onset of a massive global vaccination campaign, largely explains the projected increase in foreign demand growth in 2021. The resilience of the goods market in the face of global crisis and an expected normalization in international trade are additional factors. These considerations and the expected continuation of a gradual reduction of mobility restrictions abroad suggest that Colombia’s trade partners could grow on average by 5.2% in 2021 and around 3.4% in 2022. The improved prospects for global economic growth have led to an increase in current and expected oil prices. Production interruptions due to a heavy winter, reduced inventories, and increased supply restrictions instituted by producing countries have also contributed to the increase. Meanwhile, market forecasts and recent Federal Reserve pronouncements suggest that the benchmark interest rate in the U.S. will remain stable for the next two years. Nevertheless, a significant increase in public spending in the country has fostered expectations for greater growth and inflation, as well as increased uncertainty over the moment in which a normalization of monetary policy might begin. This has been reflected in an increase in long-term interest rates. In this context, emerging market economies in the region, including Colombia, have registered increases in sovereign risk premiums and long-term domestic interest rates, and a depreciation of local currencies against the dollar. Recent outbreaks of COVID-19 in several of these economies; limits on vaccine supply and the slow pace of immunization campaigns in some countries; a significant increase in public debt; and tensions between the United States and China, among other factors, all add to a high level of uncertainty surrounding interest rate spreads, external financing conditions, and the future performance of risk premiums. The impact that this environment could have on the exchange rate and on domestic financing conditions represent risks to the macroeconomic and monetary policy forecasts. Domestic financial conditions continue to favor recovery in economic activity. The transmission of reductions to the policy interest rate on credit rates has been significant. The banking portfolio continues to recover amid circumstances that have affected both the supply and demand for loans, and in which some credit risks have materialized. Preferential and ordinary commercial interest rates have fallen to a similar degree as the benchmark interest rate. As is generally the case, this transmission has come at a slower pace for consumer credit rates, and has been further delayed in the case of mortgage rates. Commercial credit levels stabilized above pre-pandemic levels in March, following an increase resulting from significant liquidity requirements for businesses in the second quarter of 2020. The consumer credit portfolio continued to recover and has now surpassed February 2020 levels, though overall growth in the portfolio remains low. At the same time, portfolio projections and default indicators have increased, and credit establishment earnings have come down. Despite this, credit disbursements continue to recover and solvency indicators remain well above regulatory minimums. 1.2 Monetary policy decision In its meetings in March and April the BDBR left the benchmark interest rate unchanged at 1.75%.

1.1 Resumen macroeconómico En el segundo trimestre la economía enfrentó varios choques, principalmente de oferta y de costos, la mayoría de los cuales no fueron anticipados, o los previstos fueron más persistentes de lo esperado, y que en conjunto interrumpieron la recuperación de la actividad económica observada a comienzos de año y llevaron la inflación total a niveles superiores a la meta. La inflación básica (sin alimentos ni regulados: SAR) aumentó, pero se mantuvo baja y acorde con lo esperado por el equipo técnico. A comienzos de abril se inició una tercera ola de pandemia, más acentuada y prolongada que la anterior, con un elevado costo en vidas humanas y algún impacto negativo en la recuperación económica. Entre mayo y mediados de junio los bloqueos de las carreteras y los problemas de orden público tuvieron un fuerte efecto negativo sobre la actividad económica y la inflación. Se estima que la magnitud de estos dos choques combinados habría generado una caída en niveles en el producto interno bruto (PIB) con respecto al primer trimestre del año. Adicionalmente, los bloqueos causaron un aumento significativo de los precios de los alimentos. A estos choques se sumaron los efectos acumulados de la disrupción global en algunas cadenas de valor y el incremento en los fletes internacionales que desde finales de 2020 vienen generando restricciones de oferta y aumentos de costos. Todos estos factores, que afectaron principalmente el índice de precios al consumidor (IPC) de bienes y de alimentos, explicaron la mayor parte del error de pronóstico del equipo técnico y el aumento de la inflación total a niveles superiores a la meta del 3 %. El incremento en la inflación básica y de los precios de los regulados fue acorde con lo esperado por el equipo técnico, y se explica principalmente por la eliminación de varios alivios de precios otorgados un año atrás. A todo esto se suma la mayor percepción de riesgo soberano y las presiones al alza que esto implica sobre el costo de financiamiento externo y la tasa de cambio. A pesar de los fuertes choques negativos, el crecimiento económico esperado para la primera mitad del año (9,1%), es significativamente mayor que lo proyectado en el informe de abril (7,1%), signo de una economía más dinámica que se recuperaría más rápido de lo previsto. Desde finales de 2020 las diferentes cifras de actividad económica han mostrado un crecimiento mayor que el esperado. Esto sugiere que los efectos negativos sobre el producto de las recurrentes olas de contagio estarían siendo cada vez menos fuertes y duraderos. No obstante, la tercera ola de contagio del Covid-19, y en mayor medida los bloqueos a las vías y los problemas de orden público, habrían generado una caída del PIB durante el segundo trimestre, frente al primero. Pese a lo anterior, los datos del índice de seguimiento a la economía (ISE) de abril y mayo han resultado mayores que lo esperado, y las nuevas cifras de actividad económica sectoriales sugieren que el impacto negativo de la pandemia sobre el producto se sigue moderando, en un entorno de menores restricciones a la movilidad y de mayor avance en el ritmo de vacunación. Los registros de transporte de carga (junio) y la demanda de energía no regulada (julio), entre otros, indican una recuperación importante después de los bloqueos en mayo. Con todo lo anterior, el incremento anual del PIB del segundo trimestre se habría situado alrededor del 17,3 % (antes 15,8 %), explicado en gran parte por una base baja de comparación. Para todo 2021 el equipo técnico incrementó su proyección de crecimiento desde un 6 % hasta el 7,5 %. Este pronóstico, que está rodeado de una incertidumbre inusualmente elevada, supone que no se presentarán problemas de orden público y que posibles nuevas olas de contagio del Covid-19 no tendrán efectos negativos adicionales sobre la actividad económica. Frente al pronóstico del informe pasado, la recuperación de la demanda externa, los niveles de precios de algunos bienes básicos que exporta el país y la dinámica de las remesas de trabajadores han sido mejores que las esperadas y seguirían impulsando la recuperación del ingreso nacional en lo que resta del año. A esto se sumaría la aún amplia liquidez internacional, la aceleración en el proceso de vacunación y las bajas tasas de interés, factores que continuarían favoreciendo la actividad económica. La mejor dinámica del primer semestre, que llevó a una revisión al alza en el crecimiento de todos los componentes del gasto, continuaría hacia adelante y, antes de lo esperado en abril, la economía recuperaría los niveles de producción de 2019 a finales de 2021. El pronóstico continúa incluyendo efectos de corto plazo sobre la demanda agregada de una reforma tributaria de magnitud similar a la proyectada por el Gobierno. Con todo eso, en el escenario central de este informe, el pronóstico de crecimiento para 2021 es del 7,5 % y para 2022 del 3,1 %. A pesar de esto, el nivel de la actividad económica seguiría siendo inferior a su potencial. La mejora en estas proyecciones, sin embargo, está rodeada de una alta incertidumbre. En junio la inflación anual (3,63 %) aumentó más de lo esperado debido al comportamiento del grupo de alimentos, mientras que la inflación básica (1,87 %) fue similar a la proyectada. En lo que resta del año el mayor nivel del IPC de alimentos persistiría y contribuiría a mantener la inflación por encima de la meta. A finales de 2022 la inflación total y básica retornarían a tasas cercanas al 3 %, en un entorno de desaceleración del IPC de alimentos y de menores excesos de capacidad productiva. En los meses recientes el aumento en los precios internacionales de los fletes y de los bienes agrícolas, y las mayores exportaciones de carne y el ciclo ganadero han ejercido presiones al alza sobre el precio de los alimentos, principalmente de los procesados. A estas fuerzas persistentes se sumaron los bloqueos de las vías nacionales y los problemas de orden público en varias ciudades registrados en mayo y parte de junio, los cuales se reflejaron en una fuerte restricción en la oferta y en un aumento anual no esperado del IPC de alimentos (8,52 %). El grupo de regulados (5,93 %) también se aceleró, debido a la baja base de comparación en los precios de la gasolina y a la disolución de parte de los alivios a las tarifas de servicios públicos otorgados en 2020. Como se proyectaba, la inflación SAR repuntó al 1,87 %, debido a la reactivación de los impuestos indirectos de algunos bienes y servicios eliminados un año atrás, y por las presiones al alza que ejercieron los alimentos sobre las comidas fuera del hogar (CFH), entre otros. En lo que resta del año se espera que el aumento en los alimentos perecederos se revierta, siempre y cuando no se registren nuevos bloqueos duraderos a las vías nacionales. El mayor nivel de precios de los alimentos procesados persistiría y contribuiría a mantener la inflación por encima de la meta a finales de año. La inflación SAR continuaría con una tendencia creciente, en la medida en que los excesos de capacidad productiva se sigan cerrando y registraría un aumento transitorio en marzo de 2022, debido principalmente al restablecimiento del impuesto al consumo en las CFH. Con todo esto, para finales de 2021 y 2022 se estima una inflación total del 4,1 % y 3,1 %, y una inflación básica del 2,6 % y 3,2 %, respectivamente. El comportamiento conjunto de los precios del IPC SAR, junto con continuas sorpresas al alza en la actividad económica, son interpretados por el equipo técnico como señales de amplios excesos de capacidad productiva de la economía. Estos persistirían en los siguientes dos años, al final de los cuales la brecha del producto se cerraría. El mayor crecimiento económico sugiere una brecha del producto menos negativa que la estimada hace un trimestre. Sin embargo, el comportamiento de la inflación básica, especialmente en servicios, indica que el PIB potencial se ha recuperado de forma sorpresiva y que los excesos de capacidad siguen siendo amplios, con una demanda agregada afectada de forma persistente. Esta interpretación encuentra soporte en el mercado laboral, en donde persiste un desempleo alto y la recuperación de los empleos perdidos se estancó. Adicionalmente, los aumentos en la inflación en buena medida están explicados por choques de oferta y de costos y por la disolución de algunos alivios de precios otorgados un año atrás. Los pronósticos de crecimiento y de inflación descritos son coherentes con una brecha del producto que se cierra más rápido y es menos negativa en todo el horizonte de pronóstico con respecto al informe de abril. No obstante, la incertidumbre sobre los excesos de capacidad es muy alta y es un riesgo sobre el pronóstico. Las perspectivas de las cuentas fiscales de Colombia se deterioraron, Standard & Poor’s Global Ratings (S&P) y Fitch Ratings (Fitch) redujeron su calificación crediticia, los bloqueos y problemas de orden público afectaron el producto y el país enfrentó una nueva ola de contagios de Covid-19 más acentuada y prolongada que las pasadas. Todo lo anterior se ha reflejado en un aumento de las primas de riesgo y en una depreciación del peso frente al dólar. Esto ha ocurrido en un entorno favorable de ingresos externos. Los precios internacionales del petróleo, del café y de otros bienes básicos que exporta el país aumentaron y han contribuido a la recuperación de los términos de intercambio y del ingreso nacional, y han mitigado las presiones al alza sobre las primas de riesgo y la tasa de cambio. En el presente informe se incrementó el precio esperado del petróleo para 2021 a USD 68 por barril (antes USD 61 bl) y para 2022 a USD 66 bl (antes USD 60 bl). Esta mayor senda presenta una convergencia hacia precios menores que los observados recientemente, como resultado de una mayor oferta mundial esperada de petróleo, la cual más que compensaría el incremento en la demanda de este bien básico. Por ende, se supone que el aumento reciente de los precios tiene un carácter transitorio. En el escenario macroeconómico actual se espera que las condiciones financieras internacionales sean algo menos favorables, a pesar de la mejora en los ingresos externos por cuenta de una mayor demanda y unos precios del petróleo y de otros productos de exportación más altos. Frente al informe de abril el crecimiento de la demanda externa fue mejor que el esperado, y las proyecciones para 2021 y 2022 aumentaron del 5,2 % al 6,0 % y del 3,4 % al 3,5 %, respectivamente. En lo corrido del año las cifras de actividad económica muestran una demanda externa más dinámica de la esperada. En los Estados Unidos y China la recuperación del producto ha sido más rápida que la registrada en los países de la región. En estos últimos la reactivación económica ha estado limitada por los rebrotes del Covid-19, las limitaciones en la oferta de vacunas y el poco espacio fiscal para enfrentar la pandemia, entre otros factores. La buena dinámica en el comercio externo de bienes se ha dado en un entorno de deterioro en las cadenas de valor y de un aumento importante en los precios de las materias primas y en el costo de los fletes. En los Estados Unidos la inflación sorprendió al alza y su valor observado y esperado se mantiene por encima de la meta, al tiempo que se incrementó la proyección de crecimiento económico. Con esto, el inicio de la normalización de la política monetaria en ese país se daría antes de lo proyectado. En este informe se estima que el primer incremento en la tasa de interés de la Reserva Federal de los Estados Unidos se dé a finales de 2022 (antes del primer trimestre de 2023). Para Colombia se supone una mayor prima de riesgo frente al informe de abril y se sigue esperando que presente una tendencia creciente, dada la acumulación de deuda pública y externa del país. Todo esto contribuiría a un incremento en el costo del financiamiento externo en el horizonte de pronóstico. La postura expansiva de la política monetaria sigue soportando unas condiciones financieras internas favorables. En el segundo trimestre la tasa de interés interbancaria y el índice bancario de referencia (IBR) se han mantenido acordes con la tasa de interés de política. Las tasas de interés promedio de captación y crédito continuaron históricamente bajas, a pesar de algunos incrementos observados a finales de junio. La cartera en moneda nacional detuvo su desaceleración anual y, entre marzo y junio, el crédito a los hogares se aceleró, principalmente para compra de vivienda. La recuperación de la cartera comercial y de los desembolsos a ese sector fue importante, y se alcanzó de nuevo el elevado saldo observado un año atrás, cuando las empresas requirieron niveles significativos de liquidez para enfrentar los efectos económicos de la pandemia. El riesgo de crédito aumentó, las provisiones se mantienes altas y algunos bancos han retirado de su balance una parte de su cartera vencida. No obstante, las utilidades del sistema financiero se han recuperado y sus niveles de liquidez y solvencia se mantienen por encima del mínimo regulatorio. A partir de este informe se implementará una nueva metodología para cuantificar y comunicar la incertidumbre que rodea los pronósticos del escenario macroeconómico central, en un entorno de política monetaria activa. Esta metodología se conoce como densidades predictivas (DP) y se explica en detalle en el Recuadro 1. Partiendo del balance de riesgos que contiene los principales factores que, de acuerdo con el juicio del equipo técnico, podrían afectar a la economía en el horizonte de pronóstico, la metodología DP produce distribuciones de probabilidad sobre el pronóstico de las principales variables (v. g.: crecimiento, inflación). Estas distribuciones reflejan el resultado de los posibles choques (a variables externas, precios y actividad económica) que podría recibir la economía y su transmisión, considerando la estructura económica y la respuesta de política monetaria en el futuro. En este sentido, permiten cuantificar la incertidumbre alrededor del pronóstico y su sesgo. El ejercicio DP muestra un sesgo a la baja en el crecimiento económico y en la brecha del producto, y al alza en la inflación. El balance de riesgos indica que las disyuntivas para la política monetaria serán potencialmente más complejas que lo contemplado en el pasado. Por el lado de las condiciones de financiamiento externo, se considera que el mayor riesgo es que se tornen un poco menos favorables, en un escenario en el cual la Reserva Federal de los Estados Unidos incremente con mayor prontitud su tasa de interés. Esto último, ante un crecimiento económico y del empleo mayor que el esperado en los Estados Unidos que genere presiones significativas sobre la inflación de ese país. A esto se suma la incertidumbre sobre el panorama fiscal en Colombia y sus efectos sobre la prima de riesgo y el costo del financiamiento externo. En el caso del crecimiento, la mayoría de los riesgos son a la baja, destacándose los efectos de la incertidumbre política y fiscal sobre las decisiones de consumo e inversión, la aparición de nuevas olas de contagio de la pandemia del Covid-19 y sus impactos sobre la actividad económica. En el caso de la inflación, se incorporó el riesgo de una mayor persistencia de los choques asociados con la disrupción de las cadenas de valor, mayores precios internacionales de las materias primas y de los alimentos, y una recuperación más lenta que la esperada de la cadena agrícola nacional afectada por los pasados bloqueos a las vías. Estos riesgos presionarían al alza principalmente los precios de los alimentos y de los bienes. Como principal riesgo a la baja se incluyó un alza de los arriendos menor que el esperado en el escenario central, explicada por una demanda débil y por una mayor oferta en 2022 dadas las altas ventas de vivienda observadas en el presente año. Con todo, el crecimiento económico presenta un sesgo a la baja y, con el 90 % de confianza, se encontraría entre un 6,1 % y 9,1 % para 2021 y entre el 0,5 % y 4,1 % para 2022. La brecha del producto tendría un sesgo a la baja, principalmente en 2022. El sesgo de la inflación es al alza, y se encontraría entre el 3,7 % y 4,9 % en 2021, y el 2,2 % y 4,7 % en 2022, con un 90 % de probabilidad. 1.2 Decisión de política monetaria En las reuniones de junio y julio la JDBR decidió mantener la tasa de política monetaria inalterada en 1,75 %.

In the face of the multiple shocks currently experienced by the domestic economy (resulting from the drop in oil prices and the appearance of a global pandemic), the Colombian financial system is in a position of sound solvency and adequate liquidity. At the same time, credit quality has been recovering and the exposure of credit institutions to firms with currency mismatches has declined relative to previous episodes of sudden drops in oil prices. These trends are reflected in the recent fading of red and blue tonalities in the performance and credit risk segments of the risk heatmaps in Graphs A and B.1 Naturally, the sudden, unanticipated change in macroeconomic conditions has caused the appearance of vulnerabilities for short-term financial stability. These vulnerabilities require close and continuous monitoring on the part of economic authorities. The main vulnerability is the response of credit and credit risk to a potential, temporarily extreme macroeconomic situation in the context of: (i) recently increased exposure of some banks to household sector, and (ii) reductions in net interest income that have led to a decline in the profitability of the banking business in the recent past. Furthermore, as a consequence of greater uncertainty and risk aversion, occasional problems may arise in the distribution of liquidity between agents and financial markets. With regards to local markets, spikes have been registered in the volatility of public and private fixed income securities in recent weeks that are consistent with the behavior of the international markets and have had a significant impact on the liquidity of those instruments (red portions in the most recent past of some market risk items on the map in Graph A). In order to adopt a forward-looking approach to those vulnerabilities, this Report presents a stress test that evaluates the resilience of credit institutions in the event of a hypothetical scenario thatseeks to simulate an extreme version of current macroeconomic conditions. The scenario assumes a hypothetical negative growth that is temporarily strong but recovers going into the middle of the coming year and has extreme effects on credit quality. The results suggest that credit institutions have the ability to withstand a significant deterioration in economic conditions in the short term. Even though there could be a strong impact on credit, liquidity, and profitability under the scenario being considered, aggregate capital ratios would probably remain at above their regulatory limits over the horizon of a year. In this context, the recent measures taken by both Banco de la República and the Office of the Financial Superintendent of Colombia that are intended to help preserve the financial stability of the Colombian economy become highly relevant. In compliance with its constitutional objectives and in coordination with the financial system’s security network, Banco de la República will continue to closely monitor the outlook for financial stability at this juncture and will make the decisions that are necessary to ensure the proper functioning of the economy, facilitate the flow of sufficient credit and liquidity resources, and further the smooth functioning of the payment system. Juan José Echavarría Governor

From this edition, the Financial Stability Report will have fewer pages with some changes in its structure. The purpose of this change is to present the most relevant facts of the financial system and their implications on the financial stability. This allows displaying the analysis more concisely and clearly, as it will focus on describing the evolution of the variables that have the greatest impact on the performance of the financial system, for estimating then the effect of a possible materialization of these risks on the financial health of the institutions. The changing dynamics of the risks faced by the financial system implies that the content of the Report adopts this new structure; therefore, some analyses and series that were regularly included will not necessarily be in each issue. However, the statistical annex that accompanies the publication of the Report will continue to present the series that were traditionally included, regardless of whether or not they are part of the content of the Report. In this way we expect to contribute in a more comprehensive way to the study and analysis of the stability of the Colombian financial system. Executive Summary During the first half of 2015, the main advanced economies showed a slow recovery on their growth, while emerging economies continued with their slowdown trend. Domestic demand in the United States allowed for stabilization on its average growth for the first half of the year, while other developed economies such as the United Kingdom, the euro zone, and Japan showed a more gradual recovery. On the other hand, the Chinese economy exhibited the lowest growth rate in five years, which has resulted in lower global dynamism. This has led to a fall in prices of the main export goods of some Latin American economies, especially oil, whose price has also responded to a larger global supply. The decrease in the terms of trade of the Latin American economies has had an impact on national income, domestic demand, and growth. This scenario has been reflected in increases in sovereign risk spreads, devaluations of stock indices, and depreciation of the exchange rates of most countries in the region. For Colombia, the fall in oil prices has also led to a decline in the terms of trade, resulting in pressure on the dynamics of national income. Additionally, the lower demand for exports helped to widen the current account deficit. This affected the prospects and economic growth of the country during the first half of 2015. This economic context could have an impact on the payment capacity of debtors and on the valuation of investments, affecting the soundness of the financial system. However, the results of the analysis featured in this edition of the Report show that, facing an adverse scenario, the vulnerability of the financial system in terms of solvency and liquidity is low. The analysis of the current situation of credit institutions (CI) shows that growth of the gross loan portfolio remained relatively stable, as well as the loan portfolio quality indicators, except for microcredit, which showed a decrease in these indicators. Regarding liabilities, traditional sources of funding have lost market share versus non-traditional ones (bonds, money market operations and in the interbank market), but still represent more than 70%. Moreover, the solvency indicator remained relatively stable. As for non-banking financial institutions (NBFI), the slowdown observed during the first six months of 2015 in the real annual growth of the assets total, both in the proprietary and third party position, stands out. The analysis of the main debtors of the financial system shows that indebtedness of the private corporate sector has increased in the last year, mostly driven by an increase in the debt balance with domestic and foreign financial institutions. However, the increase in this latter source of funding has been influenced by the depreciation of the Colombian peso vis-à-vis the US dollar since mid-2014. The financial indicators reflected a favorable behavior with respect to the historical average, except for the profitability indicators; although they were below the average, they have shown improvement in the last year. By economic sector, it is noted that the firms focused on farming, mining and transportation activities recorded the highest levels of risk perception by credit institutions, and the largest increases in default levels with respect to those observed in December 2014. Meanwhile, households have shown an increase in the financial burden, mainly due to growth in the consumer loan portfolio, in which the modalities of credit card, payroll deductible loan, revolving and vehicle loan are those that have reported greater increases in risk indicators. On the side of investments that could be affected by the devaluation in the portfolio of credit institutions and non-banking financial institutions (NBFI), the largest share of public debt securities, variable-yield securities and domestic private debt securities is highlighted. The value of these portfolios fell between February and August 2015, driven by the devaluation in the market of these investments throughout the year. Furthermore, the analysis of the liquidity risk indicator (LRI) shows that all intermediaries showed adequate levels and exhibit a stable behavior. Likewise, the fragility analysis of the financial system associated with the increase in the use of non-traditional funding sources does not evidence a greater exposure to liquidity risk. Stress tests assess the impact of the possible joint materialization of credit and market risks, and reveal that neither the aggregate solvency indicator, nor the liquidity risk indicator (LRI) of the system would be below the established legal limits. The entities that result more individually affected have a low share in the total assets of the credit institutions; therefore, a risk to the financial system as a whole is not observed. José Darío Uribe Governor