Government sources confirmed to Ámbito that at least two national capital banks asked them to deregulate credit in dollars. The request aims to make the macroprudential regulations that were established after the 2001 crisis more flexible and that force entities to direct loans towards subjects that generate foreign currency.. Two senior officials from the economic team acknowledged that the proposal is “under analysis.”
There are differences in the sector: The president of Banco Santander said that directing credit in dollars towards those who generate it is “a fundamental principle to guarantee the sustainability and confidence of the financial system.”
The success of the latest money laundering increased the banks’ liquidity in foreign currency. According to the Customs Collection and Control Agency (ARCA), some US$20 billion were regularized. Private deposits in dollars reached their highest point of the year on October 31, when they reached US$34 billion. Then there was a drip exit that keeps them above US$31,000 million, above the levels prior to the asset regularization regime.
Two officials from the economic team confirmed to this medium that the new scenario led at least two national capital banks to ask the Government to deregulate credit in dollars. The request aims to make the macroprudential regulations that were implemented after the 2001 crisis more flexible and that only allow lending in foreign currency to those who generate foreign currency.
The Minister of Economy, Luis Caputo, said this week that due to the reforms that Javier Milei is carrying out, added to the performance of energy and mining, there will be surplus dollars in Argentina. In that same event at the Buenos Aires Stock Exchange and in front of businessmen, he mentioned the possibility of making regulations more flexible for some sectors such as construction.
One of the Government sources consulted by this medium said that “every proposal will be analyzed, but there is still no position taken.” This occurs because, within the financial sector itself, there are different positions on the issue.
Credit boom in dollars and risk for the financial sector?
For Emiliano Anselmi, Economist Head of Personal Investment Portfolio (PPI)“the Government is seeking to accelerate the dynamic that allows idle dollars to be transformed into loans to increase supply in the market of exchange rates and that the Central Bank continues to accumulate reserves.”
On this point, he stressed that “expanding the universe of loanable capacity of dollars is a fairly immediate way“, although he maintained that this restriction is “one of the few good things left by the 2001 crisis and that with these same macroprudential measures in previous years there were more loans in dollars.”
In response to Ámbito’s consultation, The former vice president of the Central Bank Jorge Carrera, considered the measure “dangerous” and said that “the release of the rule is going to bring a credit boom in dollars but it is going to generate a risk in the financial system” and He highlighted that this same problem “led us to the collapse of convertibility because there was a large amount of credit in dollars that generated argendollars and when there was a devaluation the financial system collapsed.”
Credits in dollars: banks get involved in the debate
This week, Javier Bolzico, president of Adeba, said about loans in dollars that “it is an issue that must be discussed in the coming months to increase the competitiveness of the economy.”always taking into account the stability of the system” and argued that “the focus must be on correct risk management “according to international standards and not prohibition.”
Instead, The president of Banco Santander, Alejandro Butti, assured that directing credit in dollars towards those who generate it is “a fundamental principle to guarantee the sustainability and confidence of the financial system.”. This position, in general terms, is shared by the international banks grouped within ABA.
Among those entities, They warn that the relaxation of the rule would bring risks for the system and for the debtors in the event of a possible devaluation. They also highlight that macroprudential regulations made it possible to go through different difficulties such as the 2008 international financial crisis, the exchange rate run, and the withdrawal of deposits in 2018 without problems. And above all, they highlight that they allowed confidence to be restored in the banking system.
Source: Ambito
