The government bill that seeks to provide a solution to more than 24,000 debtors of the Mortgage Bank of Uruguay (BHU) generates controversy due to the proposal included that the Bank of the Eastern Republic of Uruguay (BROU) absorb the entity oriented to state participation in the real estate market; and brought together several voices against and in favor.
First, there is the very same bank that threatened mass demonstrations if the project is approved. For the president of the BHU, Casilda Echevarria, the bank “has the possibility, due to its patrimonial responsibility, to bear the impact” of the application of the initiative. Thus, before the Senate Housing Commission, he insisted that he can move forward “without the need to join Banco República”.
For his part, the director for the Broad Front of the BHU, Gabriel Frugoni, considered before the legislators that a merger with BROU would take years and would imply a “loss of credibility”. In addition, he alerted for a “contagion effect” that could encourage other debtors not included in the project to try to achieve write-offs through the courts.
Various personalities of the political arch They were also against the merger of these banks, among them, the Minister of Housing and Territorial Planning (MVOT), Raul Lozano. Despite having been one of the senators who participated in the elaboration of the project in question, along with the nationalists Sergio Botana and Carlos Camy, and the colorado German CoutinhoLozano rejected the fact that the idea of the merger or absorption of the BHU was included since, from its political force, Town meetingIt is not in the plans for the state bank to disappear.
The Broad Front, against
Meanwhile, the opposition also made itself heard through Senator Mario Bergara, who assured that “there are no foundations” to consider the government proposal that seeks to merge these two banks as a solution to the problem of debtors in Indexed Units (UI) of the BHU.
According to Bergara, the proposal “fell from the sky without anyone discussing it before” and did not go through “any study”. “In parliamentary jargon, when the Executive Branch sends a billsends it with a statement of reasons”, he slipped.
“One has to be open to evaluating and studying these issues”, as long as there is “a process in which it is said what are the reasons why this is raised, and what are the advantages and disadvantages of doing it or not”, but “none of that is on the table,” he shot.
The former head of the MEF highlighted the solidity of both banks and their “important” assets as another factor that makes it difficult to understand a possible annex between them. “We know that this government has a fundamentalist and ideological desire to shrink the State”he pointed.
The union’s opinion
The Association of Bank Employees of Uruguay (AEBU), for his part, he also rejected the project. At a press conference, the president of the Official Financial Sector Council of AEBU, Maria Eugenia Estoup, established that the inclusion of both the issue of debtors in UR as “the merger of the BHU with the Republic Bank (BROU) ” in the same proposal when “they are two separate issues”.
According to Estoup, the restructuring of the debts in UR —an issue long claimed by the people affected— “does not necessarily imply a merger” between the banksor the absorption of the BHU by the BROU, because the agency “has the back to support the restructuring of the debt that this bill implies.”
The voices in favor
The first to speak in favor was President of Banco Republica, Salvador Ferrer, who assured that the merger between the banking entities it is not a bilge measure” and even described it as an initiative that will promote “the development of the real estate market”.
For the BROU holder, this “synergy” will allow Uruguay have “a much more active player in the mortgage sector”, which will help the development of the market. When evaluating the data from the bank, he assured that private banking grew considerably more than the BHU during the last 10 years in the granting of mortgage loans. “The BHU placed 60% of the volume of the mortgage loan; today it is around 25% ”, he detailed.
Coinciding with Ferrer, the Senator Sergio Botana also justified the merger by ensuring that “it is not justified to have state structures that do not fulfill functions” and criticized the existence “270 officials to give four credits per day.”
For Botana, workers must have “higher productivity” and questioned that the BHU requires “double what is charged for a mortgage loan in the private market” and sentenced: “It’s a real murder of the people.”
Source: Ambito
