May 7, 2023, 5:44 PM
May 7, 2023, 5:44 PM
One of the Pension Fund Administrators (AFP) invested $90 million in Fassil in the months prior to the intervention of that bank and when it was already known that he was going through “very complicated” times, revealed the Minister of Economy and Public Finance, Marcelo Montenegro. The authority also announced that it will evaluate whether Futuro and Previsión BBVA made a “rigorous valuation” before investing resources from the pension funds.
“In the last difficult moment that this bank has gone through, one of the AFPs has given it $90 million. Under what circumstance? When there was already news that this bank was going through a very complicated process”, Montenegro said at a press conference.
On May 5, EL DEBER reported that the Pension Fund Administrators Futuro and Previsión BBVA jointly invested $1,274 million of the pension funds in Banco Fassil, intervened on April 26 for not having the money in cash enough to return the resources of their savers.
According to a report as of December 31 of the Pension and Insurance Supervisory Authority (APS), the AFP Previsión BBVA invested in Fassil in time deposits (DPF) in dollars and Bolivianos, as well as in US currency bonds; while the AFP Futuro of Bolivia invested in that financial entity in DPF in national currency.
In total, $1,274 million of the workers’ contributions for their retirement were used to finance the bank intervened todaywhich represents 5.36% of the $us 23,766 million (nominal value) that the investments made by the pension funds have in total.
“It will be necessary to evaluate if the AFPs made a rigorous evaluation when investing or perhaps there was some other element. I would not like to think that it is simply an endorsement even of a political nature”, asserted the Minister of Economy.
“In any case, the national government is going to stop these operations with a Manager that will make transparent evaluations, evaluations that will allow improving the profitability” of the contributions for retirement, he added.
Both Futuro and Previsión BBVA are supervised by the Pension and Insurance Supervision Authority.
According to analysts and stock market playersBanco Fassil’s problems began at least a couple of years ago, which caused a continuous reduction of its risk rating as an issuer and of its issued securities, as well as a “greater caution” when negotiating “anything” related to that bank.
Montenegro further confirmed that the DPF and Fassil bonds acquired by the AFPs will be part of the loan and deposit portfolio packages (including savings accounts and checking accounts) that will be tendered to other banks as part of the intervention of the fourth largest bank in the financial system national.
He reported that at least eight financial entities have already expressed their interest in winning the Fassil packages that will be tendered by the Financial System Supervision Authority (ASFI). There are “eight to nine interested banks. The topic deserves that dimension of participation”, Indian.
The Financial Services Law establishes three ways in which savers (a group that would include pension fund contributors) may recover their money in a bank undergoing intervention.
In principle, there is the solution procedure, in which other financial entities will take charge of an equal percentage of the bank’s deposits and credits. Then there is the liquidation process with deposit insurance, in which returns are made with the support of the Saver Protection Fund. Finally, there is the judicial forced liquidation, in which the auction of real estate and other bank assets is used to cover the obligations.
Among 11 multiple banks in the country, Fassil is the third in credit portfolio (Bs 20,984 million), the fourth in deposits (Bs 20,112 million), the fourth in assets (Bs 31,438 million), he seventh in heritage (Bs 1,497 million) and the tenth in profits, according to data for 2022 from the ASFI and the Camel Ranking of Banks.
