trending Market Intelligence /marketintelligence/en/news-insights/trending/wtOkwIJH7OO_OUMMkVzY7A2 content esgSubNav
In This List

Venezuela's Banco Occidental under state intervention after affiliate's closure

Podcast

Street Talk Episode 87

Blog

A New Dawn for European Bank M&A Top 5 Trends

Blog

Insight Weekly: US banks' loan growth; record share buybacks; utility M&A outlook

Blog

Banking Essentials Newsletter 2021: December Edition


Venezuela's Banco Occidental under state intervention after affiliate's closure

Venezuela's banking regulator Sudeban will temporarily intervene at private bank Banco Occidental de Descuento Banco Universal CA after it closed an offshore affiliate in Curaçao, Reuters reported, citing a document.

The measure, which could last for more than 120 days, would prevent certain activities of the bank, including dividend payouts, new investments and new board hires.

However, Banco Occidental de Descuento owner Victor Vargas said the measure hardly qualifies as an "intervention," but rather as "an administrative measure – totally normal in the financial system worldwide – which simply does not impede [the bank's] normal functioning."

The decision comes after Curaçao regulators carried out an "emergency measure" that suspended the operations of Banco del Orinoco NV, an associate of the Venezuelan bank, on Sept. 5. The action was driven by the bank's "deficiencies," the regulators said.

Vargas said Banco Occidental de Descuento filed an appeal against Curaçao's action. The bank later closed Banco del Orinoco, but authorities froze its assets amid an ongoing investigation on its finances.

Banco Occidental de Descuento owned 19.00% of Banco del Orinoco, according to data from S&P Global Market Intelligence.

Curaçao's ruling led to an intervention of the Panama's banking regulator SBP at Allbank, which is also an affiliate of the Venezuelan bank. Among the reasons for the intervention are possible "contagion effects" from the conditions of the Curaçao affiliate, the SBP said.