Guatemalan banks ask for more liquidity

The local banking system started to feel the effects of the international financial crisis with credit restrictions in place from international correspondent banks.

Thursday, November 6, 2008

Some entities have already lost this option, while others that have managed to borrow money have found that the price has increased.

This is because the national banks are seeing a considerable reduction in their liquidity for loans, a problem which could be resolved by reducing the main Guatemalan rate or with decrease in the percentage of legal reserves, bankers said.

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Salvadoran Banks ask for lower credit rate from the IDB

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ABANSA believes that the cost of accessing the $500 million made available with IDB funds is too high.

Armando Arias, president of the group said that the rate of the funds corresponds to the LIBOR plus 400 base points more in commissions and is practically the same as the rates offered by other international lenders.

Guatemalan Government injects $275 million.

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The Monetary Board in charge of directing macroeconomic policies of the country opened a special account in US dollars and placed it at the disposal of the private banks to help them acquire liquidity.

Maria Antonieta Bonilla explained that the account would come into effect as of 31st Jan, 09 with the objective of giving liquidity to banks in the system that have had some difficulties.

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The rise in the cost of money, which was announced as an adverse consequence of the lack of liquidity on the global stage, is being felt in the country.

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Banks in Panama have enough liquidity and are properly positioned to face the international credit crisis, the head of supervising the sector said on Monday.

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