2022 may be the year in which the State ceases to be the main shareholder of Banco del Pacífico and that the institution, which has assets of around $850 million, returns to private hands. Eduardo Salgado, general manager of the National Financial Corporation (CFN), the main shareholder of the banking institution, tells details of the sale process, as well as the current situation of the CFN after the results of a portfolio audit carried out by Deloitte.
How is the process of selling Banco del Pacífico going?
I am giving you a summary because he (Roberto González, president of Banco del Pacífico) is a good executive, it is up to him and the bank to keep reporting, but he asks me and I can tell him what he has said; that it was contracting, I imagine that it was already contracted, the updating of the bank’s appraisal and it has said that the equity is worth a minimum, I think $850 million something like that and that, after the appraisal, work will begin on the terms of reference for a bidding or auction where it is preferred that international financial groups come, and that it will probably be bidding between June and September of this year.
Are there already international groups interested?
I know two (from Mexico), that is, I know them by name, but I have not interviewed them, that corresponds to Roberto’s group, looking for potential clients.
What process is the bank currently in?
It is walking, the accounts continue to be purged, since it is a more private than public bank, it is private in fact, it has been done faster than us (the CFN). Here we with the regulations, the control organisms, all this is like moving something heavy, here we are going to do it anyway and we are doing it.
Roberto González, president of Banco del Pacífico: There are people who intend to link the closure of agencies with the loss of value of a bank. I am eliminating losses for the entity
And speaking of the CFN process, how is it going?
We are very concerned at the CFN about the environment in the judicial system. We have taken this administration on July 15 and so far we have cleaned up the portfolio with a Deloitte report, that is, how the portfolio is in terms of strengths and weaknesses and we find that it is wrong, Deloitte reviewed 80%.
Why did you start this audit and what results did you get?
At the suggestion of the World Bank, but at our initiative… We ourselves want a prestigious company that knows risk analysis to come in. I worked at Citibank, this is not a simple thing (…), this is going to see what analysis was done prior to the disbursement, what guarantee was requested, if the cash flows were analyzed correctly, if a study of the request of that customer. Something that impressed me a lot is a hotel on the road to Data, a start up, that is, a new client, let’s see, but what are the projections? Today the debt is more than $1 million and he does not sell more than 200,000, this means that he will never pay, and thus we could invest not to say spend, I am not exaggerating, a week with you, eight hours telling you the amount of poorly granted loans when development banking should be development banking and not a bank that does not exist, what I call a toxic portfolio, that is a good concept: toxic portfolio that is very bad to recover or is bad or is moderately bad .
Can’t the CFN enforce the guarantees to collect those credits?
The regulations of the CFN say so and the law says so: the dation of payment that is established is a voluntary act of mutual agreement between the parties; if the creditor is willing to accept an asset that is well valued, but in most of the cases that we have seen, that we are rejecting the dation of payment, they are overvalued assets, others that are not part of the guarantee, as I have a case of a good that they want to give us via the coast when the credit was granted here in Guayaquil and the guarantees are in Guayaquil. A judge through resolution or order, whatever it’s called because I’m not a lawyer, since it’s a sentence it says that we have to receive that asset as dation and the debt is around $8 million, what does it mean here? We fill our mouths talking about public officials being responsible and that they have to say things, I am saying it and who is doing something about it, nobody.
What does the Judicial Council tell you?
When I go to the Council of the Judiciary (they tell me) you don’t just tell me this, how can you not tell me this? I’m going to know that.
What measures has the CFN taken before the CJ?
When court sentences come, we have appealed them. There are three cases that we cannot say names.
How much has the CFN received in this type of goods?
In the past it has received close to $100 million, but today they want to give us again these here that I am telling you (three cases on appeal) that add up to more or less $20 million. If the CFN belongs to the Ministry of Finance, we have to protect public funds that are sacred, credits like this cannot be happily granted without being responsible.
According to their figures, there are 409 lawsuits, between Quito and Guayaquil, for approximately $159 million. Do all these lawsuits present the same problems of dation of payments?
No, they derive from various internal processes, for example, from coercive processes that also go to court.
Eduardo Salgado: I have been working in banking for a few years and I have never seen what happens here (at the CFN) with clients
Why are these problems with payment dations only recently known?
If I’m here I don’t lose, but who knows how long I’ve been here, because these complaints have never been made. Deloitte’s report as of September (2021) helped us to make the largest loan loss portfolio provision in the history of the CFN, such as $600 million of provisions, it does not mean that it is lost, we are going to continue managing it.
What does that mean?
That in the last fifteen years they only made about $300 million of provisions, us $600 million in a year that later crosses with a written-off portfolio, since more than three years go by I have to write off the portfolio, so the provision drops, but it doesn’t want say that we are not going to collect, we are going to continue collecting, but the law allows that after three years of collecting we provision 100% of that portfolio.
My life is long and I have never seen (this) in banking, or anywhere, and that this continues to be allowed by justice and the country is the last straw, this has to stop, I have told the president of the Republic, I have told the CFN directorate, in this you have to be brave and say things.
What actions has the CFN taken?
We have requested audits and we will continue to request audits on the cases that we see that there are problems, because we are not judges, we are only administrators; we cannot say here I see a crime, investigate it; we can’t do it.
doWith all these irregularities, has the CFN informed the control agencies so that they can intervene?
To the Superintendence of Banks.
And what have they told them?
They’re sending out control teams.
And what could that end in?
To see what irregularities there are and they should report them to the Prosecutor’s Office.
Source: Eluniverso
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