Venezuela's Chavez Threatens To Take Over BBVA Unit, Other Banks
December 08 2010 - 8:38AM
Dow Jones News
Amid a housing shortage in Venezuela, President Hugo Chavez
threatened to expropriate the local unit of Spanish bank Banco
Bilbao Vizcaya Argentaria S.A. (BBVA, BBVA.MC) and other banks if
they don't ensure that homes and apartments they finance get lived
in immediately.
"Any bank that slips up...I'm going to expropriate it, whether
it's [BBVA Banco] Provincial, or [local banks] Banesco or Banco
Nacional de Credito," Chavez said Tuesday night.
In many cases, Chavez said banks receive a down payment from new
homeowners for a house or apartment, but then delay the move-in
process using "legal mumbo jumbo," and requiring more and more
paperwork to be filled out.
"If the apartment is ready for move-in, then it must be occupied
immediately!" Chavez warned.
Lack of sufficient housing for Venezuela's 28 million people has
been a problem in this oil-rich nation for decades, and during
Chavez's nearly 12 years in power the problem has become worse, as
the population has grown. In Caracas and other large cities,
millions of people are forced to live in slum communities made of
shoddily-constructed, ramshackle homes on hillsides.
This year, Venezuela has been dealing with some of the heaviest
rains and flooding in the past 40 years, making the housing problem
even worse because some 100,000 people have seen their homes
destroyed or deemed unlivable.
Chavez has threatened to expropriate banks in the past, saying
they must follow government orders to provide more business loans
to small business owners and increase the number of home loans to
poor people in their portfolio.
The president's comments about BBVA Banco Provincial comes just
days after a former vice president to Chavez, Jose Vicente Rangel,
said that sources have told him BBVA's Venezuela unit is up for
sale at a price tag of about $2 billion.
The bank repeatedly denied the claims by Rangel, who is now the
host of Sunday morning political talk show, where he made the
remarks.
"We reiterate our permanent commitment in Venezuela," the BBVA
Group said Sunday in a statement on its blog, in response to
Rangel's latest claim.
Venezuela's banking system went through a mini-crisis a year
ago, when Chavez took over a handful of small banks, nationalizing
or liquidating them and jailing several bank executives. The
takeovers didn't extend to the big banks, and analysts say the
country's overall financial system is relatively healthy.
A Venezuela banking reform bill currently wending its way
through the Chavez-controlled legislature would declare that
banking activity and banking services are a public service, which
some analysts say would make them "expropriatable" companies.
Chavez, who is trying to create socialism in Venezuela, has
nationalized more than 200 companies this year from various sectors
of the economy. That has caused many companies, banks included, to
wonder if they could be next.
-By Dan Molinski, Dow Jones Newswires; 58-414-120-5738;
dan.molinski@dowjones.com
BBVA Bilbao Vizcaya Arge... (NYSE:BBVA)
Historical Stock Chart
From Sep 2024 to Oct 2024
BBVA Bilbao Vizcaya Arge... (NYSE:BBVA)
Historical Stock Chart
From Oct 2023 to Oct 2024