A solid banking sector in the face of adversity

2020 was a year marked by the health crisis and its impact on society and businesses. Andorra was no exception, and we will remember this year for a long time to come. The uncertainties caused by the pandemic have not yet disappeared. In 2021 we will still suffer the consequences, both at a personal and professional level, in businesses and across society at large. However, from Andorran Banking, we want to send an optimistic message.

The results of Andorran banks at the end of 2020 show solidity and resilience in the face of adversity, with stronger solvency, increased assets under management and lending, and an improved NPL ratio, among other things. Moreover, financial institutions have made significant provisions to compensate for the effects of COVID-19 and to be prepared for the future.

One element that I would like to highlight is the role played by banks in Andorra during this difficult period. We have supported local government, companies and families by providing them with loans and moratoria under the recently enacted Law 5/2020 and as part of the sector-wide moratoria promoted by Andorran Banking.

In addition to the exceptional pandemic situation, which has seen Andorran banks increase their provisions twofold compared to 2019, the continued scenario of low interest rates, further compliance with international banking regulations and strong investment in technology has put pressure on the sector’s results and profitability. But we are confident that a recovery will ensue in 2021.


The General Assembly of the Andorran Banking Association has elected its new Chairman and Vice-Chairman. In accordance with the Association’s by-laws, both positions are rotated and renewable annually.

The new appointments for 2021 went to Mr Xavier Cornella Castel, CEO of Crèdit Andorrà, and to Mr José Luis Dorado Ocaña, Executive Director and General Manager of Vall Banc.


Andorran banks have closed the year 2020 with an aggregate result of €84m following the extraordinary provisions of €33m made in line with the recommendations issued by the supervisor and with international guidelines.

Despite the impact of the pandemic, Andorran banks have maintained their strength and attractiveness in terms of securing new customer funds, which increased in volume by 4%, to €51.7bn. Lending jumped by 4.5% and the solvency ratio rose to 17.71%.

During this period of time, soft loans worth €135m and moratoria on loan repayments with an outstanding balance of €122m were granted to companies and businesses.



The Andorran Banking Observatory published its third report “The role of banks in the socioeconomic growth of Andorra”.

 Throughout their history, Andorran banks have played an essential role in driving and supporting the country’s economic development. Andorra’s historical evolution would arguably not have been the same without the financing capacity of banks. This is because Andorran banks have not limited themselves to acting as local institutions with local customers, but have instead developed a private banking business that has brought a large volume of international clients and given them a much greater financing capacity. Having one’s own financial system is essential for the development of a country’s economy.


Guarantees for companies and businesses

In order to ensure that more people are eligible for the Andorran Government guarantee scheme, since the beginning of the year two decrees have been adopted to amend the Decree of 20/05/2020 approving a second extraordinary guarantee scheme for companies and businesses in connection with the health emergency caused by Covid-19.

While Decree 25/2021 covers financial lease payments, Decree 54/2021 introduces fuel costs for transport and substitutes the payment of the employer's share of the temporary suspension of employment contracts or the reduction of working hours for staff expenses (wages and salaries and contributions to the Andorran national health system).

The Andorran Government has also approved an automatic extension of 6 months for credit facilities entered into in 2020 in relation to both the first and the second extraordinary guarantee schemes. This does not prevent customers from repaying their credit or converting it into a loan if they wish to.


Fitch Ratings has confirmed its BBB+ rating and stable outlook for Andorra, highlighting the country’s recent membership of the International Monetary Fund (IMF) last October. It stresses that the Andorran banking sector has an adequate margin to withstand the effects of the pandemic.


Standard & Poor’s has reaffirmed Andorra’s rating at “BBB/A-2” and also maintains its stable outlook, highlighting the country’s fiscal capacity to withstand the consequences of the pandemic.



Bloomberg, a prestigious US company specialising in financial news, has published an article recommending the Principality of Andorra as a safe destination, along with other countries, for 2021. Andorra, a country that can be crossed on foot, offers plenty in terms of things to do and see, and is renowned for its excellent local gastronomy.



The 13th Ibero-American business meeting will take place on April 19th and 20th with the participation of leading businessmen who will discuss recent trends and innovations.

On April 21st, Andorra will have the honour of hosting the 27th Ibero-American Summit under the title of “Innovation for sustainable development - Objective 2030”. The summit will bring together Heads of State and Government from 22 Ibero-American countries.