Guatemala: Financiera de Occidente Suspended

Arguing that management practices were detected that put at risk its solvency and soundness, the Monetary Board decided to suspend the operations of Financiera de Occidente, S.A., an entity that represents 0.35% of the total assets of the local banking system.

Monday, December 16, 2019

Erick Vargas Sierra, head of the Superintendence of Banks (SIB), told Prensalibre.com that "... management practices were detected that put at risk its solvency and soundness. Faced with this scenario, the SIB ordered a regularization plan, which failed to comply with the legal deadline of three months, so proceeded the management to the Monetary Board."

From the Monetary Board statement:

On December 13, in order to preserve the stability of the national banking system, and based on the report and the request of the Superintendence of Banks, unanimously resolved to suspend the operations of Financiera de Occidente, Sociedad Anónima, an entity that represents only 0.35% of the total assets of the national banking system.

The decision includes the appointment of both the board of exclusion of assets and liabilities, as well as the legal representative of the referred institution, to carry out, in an orderly and timely manner, the exit of that entity from the national banking system. The Superintendence of Banks has been instructed to communicate to the public the mechanism to be used to operationalize the management of the investments constituted in Financiera de Occidente, Sociedad Anónima, as well as the details of the adoption of this measure.

The national financial system operates under conditions of complete normality.

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