VENEZUELA

On January 20, the Venezuelan Central Bank (BCV, for its acronym in Spanish) published three resolutions applicable to the financial sector, regulating the legal banking reserve, bank credit portfolios and account commissions. Below are further details of the measures:

• Resolution 21-01-01: Reduces the legal reserve from 93% to 85% of public deposits in national currency. In addition, it maintains the legal reserve for foreign currency deposits at 31%. Microfinance banks with a minimum intermediation coefficient of 50% must maintain a minimum legal reserve of 40%. This is already in effect. It is worth recalling that on January 14, the Venezuelan Banking Association requested the BCV to revise its legal reserve policy.

• Resolution 21-01-02: The value of all loans must be expressed in Units of Credit Value (UVC, for its acronym in Spanish), which will be indexed to the current official exchange rate, published by the BCV. Loans in local currency for credit cards and other consumer credits, with limits below 20,400 UVC, must not charge their clients an annual interest rate higher than the one published by the BCV, which is currently 40%. This measure comes into effect February 1.  

• Resolution 21-01-03: Reiterates the prohibition on the collection of commissions and fees by banking institutions from workers arising from opening or failing to maintain minimum balances in payroll accounts. It is already in force.