Banks increased their profits between January and August of this year

Between January and August 2020, during the health emergency caused

A total of 24 banks increased their assets by 6% and their equity by 11%. Although there are variations between entities, the four main banks show this growth trend, according to a study by the Institute of Economic Research of the Central University of Ecuador (UCE).

The study, prepared by Jonathan Baez, indicates that the bank’s record of profits in 2019 was $ 616 million and, with the regulations and adjustments that have been proposed, profits for 2020 would increase.

In the midst of one of the most critical moments in the Ecuadorian and global economy, due to the COVID-19 hit, banks reflect this increase in their assets and equity.

The study shows, with data from the Association of Banks of Ecuador (ASOBANCA), a comparison between January and August 2019, with the same period of this year. For example, in those eight months, Banco Pichincha had assets of $ 107,046,798. In the same period this year, the bank increased to $ 117,014,438. Banco Guayaquil, to cite another case, had an equity of $ 458,464,581 between January and August 2019. While, in the same period of 2020, his equity increased to $ 502 110 682.

Baez points out that the economic measures that have been taken facilitate the increase of these amounts. Explain that, for example,

“Official letter JPRMF-2020-0351-O promulgated by the Monetary and Financial Policy and Regulation Board of September 22, 2020 alerted the liberalization of regulations on interest rates on bank loans. However, they did not take long to put out the fire, in coordination with the economic groups of the communication, indicating that it is not about any liberalization, nor any increase in rates but that << the Central Bank of Ecuador will develop during the next five months a new methodology, and then, the new maximum lending interest rates will be determined. >> [1] A way to soften the intention to liberalize, as well as the words “concession” and “monetization” try to qualify the privatization of the assets of the State. In this way, the search not only to sustain but to increase the bank’s profits finds an echo in the Board ”.