The Association of Private Banks of Ecuador (ABPE for its Spanish acronym) defines the decision made by Rafael Correa to increase Human Development Bonus (BDH for its Spanish acronym) using banks’ surplus, as a violation of the constitutional right of profits and respect for private property.
The 26 private banks of the ABPE contribute about $ 309 million to the state over taxes and contributions, representing 80% of their total annual profits.
However, Correa said that if the banks do not like the measure, “they can complain over their representatives” and even threatened to nationalize the institution who disagrees.
The ABPE calls for politicians to make decisions without forgetting the “seriousness to the sensitivity of the issue” for the benefit of its 7 million customers who have entrusted the bank about $ 20,000 million. (MZ)
Statement by the ABPE
- Private banks do not participate in any activities of a political or electoral order, as they are exclusively dedicated on a professional manner, their delicate responsibility of taking care of customer deposits and to cooperate in the finance of national development.
- Private banks already contribute to the State approximately $ 309 million in taxes, fees and contributions, representing nearly 80% of its total net profits, significant percentage that limits the ability to provide a greater contribution to the country’s productive growth .
- Of net profits, generated by 26 Private Banks of Ecuador, after payment of taxes and contributions already mentioned, about 85% is reinvested in the training of them, strengthening their heritage in order to be able to increase lending and financial services to the productive sectors and society at large, contributing to the development and revitalization of the Ecuadorian economy.
- The Private Bank of Ecuador today enjoys an adequate financial health as the control authorities have decided, resulting from the application of the best banking practices.
- Given the important contribution made to the State by the Private Banking, it is unacceptable that the banking sector further assume the cost and any government project, and that the fact of not doing so, represents a possible limitation to the legitimate right to private property.
- The government’s approach involves a probable elimination of bank profits and ends the constitutional right to obtain them, which without them, productive and banking activities can not operate, which will become a weakening factor in the National Financial System.