Bloomberg News

Chavez Threatens to Seize Banks to Guarantee Agricultural Loans

January 30, 2012

Jan. 30 (Bloomberg) -- Venezuelan President Hugo Chavez threatened to take over the country’s banks if they don’t hand over 40 billion bolivars ($9.31 billion) for agriculture loans this year.

Chavez, speaking on state television yesterday, cited Banesco Banco Universal, BBVA Banco Provincial and Mercantil Banco Universal for giving loans to industrial producers and not to small farmers.

The government plans to create a fund called Ezequiel Zamora to assign the loans directly, while borrowers pay the banks, Chavez said. The president will use special legislative powers granted to him by the congress to create the fund, he said.

“If you don’t comply with this, I’m willing to nationalize those private banks,” Chavez said during his weekly “Alo Presidente” program.

Chavez’s government is financing housing and agriculture programs ahead of a presidential election in October and elections for governors in December. The country’s private banks last year handed over money for a government-controlled fund to finance housing construction.

Chavez asked Vice President Elias Jaua to meet with the country’s bankers, including Banesco President Juan Carlos Escotet, this week.

“Escotet, let me know if you can,” Chavez said. “If not, give me the bank.”

Chavez last year threatened to nationalize Provincial, the local unit of Banco Bilbao Vizcaya Argentaria SA, for allegedly not cooperating with the government on financing housing projects.

Venezuela’s central bank will give out 3 billion bolivars in agricultural loans this year, Chavez said.

--Editors: Joe Sabo, Sylvia Wier.

To contact the reporters on this story: Corina Rodriguez Pons in Caracas at crpons@bloomberg.net; Jose Orozco in Caracas at jorozco8@bloomberg.net.

To contact the editor responsible for this story: Joshua Goodman at jgoodman19@bloomberg.net.


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