In Ecuador a public bank is sold secretly by decision of the CFN

Neither the citizen oversight of the CPCCS has access to the information of the process that will be reserved for 15 years

While the country remains distracted by hospital corruption scandals, the government is quietly advancing the sale of Banco del Pacífico.

The National Finance Corporation (CFN) declared the process as reserved for the next 15 years, so the details of the negotiation cannot be made public.

Not even the citizen oversight, created on May 4 by the Council for Citizen Participation and Social Control (CPCCS), has access to information related to the sale.

The coordinator of the oversight, José Antonio Paz, asked the CFN for technical meetings with that body and information regarding the schedule, the legal figure of the process and the entities linked to the negotiation.

However, the response issued on July 23 by the chairman of the board, Roberto Dunn Suárez, was that “the CFN board decided that the divestment process of Banco del Pacífico is reserved,” so it is not possible to meet the requirement of the oversight.

Although he did not specify the reasons why the reservation was declared, he argued that the decision is covered by article 17 of the Organic Law of Transparency and Access to Public Information (LOTAIP), which empowers public institutions to declare information with that character.

And he warned that the disclosure of reserved information may generate civil, administrative and criminal actions against the person responsible for its disclosure, according to the LOTAIP itself.

The last information made public about the sale of Banco del Pacífico was that Bank of America Securities Inc will be in charge of valuing its shares, after being selected from among five firms.

Javier Dávalos, counselor of the CPCCS, revealed that the foreign firm concluded the valuation and presented a strategy for the sale, according to the information that the Superintendent of Banks, Ruth Arregui, gave to the plenary session of that body.

Dávalos considers that this information should be known to the country for transparency and to avoid affecting the interests of the State in the event of a possible unfavorable negotiation.

At the discretion of the former Superintendent of Banks, Alfredo Vergara, the declaration of reservation of the process of sale of the Banco del Pacífico, will give way to irregularities that the government of President Lenin Moreno does not want to be known.

“There is a negotiation there, there is no reason to declare the reserve, unless there is something obscure and that is why they put that reserve,” says Vergara, who believes that the sale of the state bank would cause an oligopoly.

He explains that currently the assets of the banking entities amount to USD 44,502,000, of which USD 22,691,000 corresponds to the 3 largest banks: Pichincha, Pacífico and Guayaquil.

Banco del Pacífico is the second largest financial institution in the country with assets of around USD 6,000 million, a profit of USD 100 million in the last year, two million clients and 17,000 service positions nationwide.

Its sale is part of the State’s asset monetization program, required by the International Monetary Fund, with which the government expects to receive USD 2 billion this year, and USD 2.5 billion in 2021.

The confidentiality of information can be declassified by the National Assembly, for which an absolute majority vote is required.

Councilor Dávalos announced that the CFN will insist that the reservation be lifted and, in the event that there is no favorable response, the Assembly will be asked to intervene.