Ecuador: Rafael Correa Lays Out Comprehensive Banking Reform
EspañolOn Wednesday, Ecuadorean President Rafael Correa forwarded a draft for a Monetary and Financial Civil Code to the National Assembly, aiming to further regulate the banking system through a national committee. Correa marked the proposal as “urgent,” so legislators have a 30-day time frame to study and vote on the bill.
The Financial and Monetary Regulation Committee will be made up of members with executive powers: the ministers responsible for economic policy, production, public finances; the planning director, and a commissioner appointed by Correa. Officials such as the superintendent of banks, the head of the Central Bank, the superintendent of companies, and the president of the Insurance Deposit Corporation, will also participate in the Committee’s deliberations, but without voting privileges.
Some of Correa’s proposed Committee’s powers include: formulating and implementing monetary, credit, foreign exchange, and financial policy; regulating actors in the financial system; and approving the monetary, credit, exchange rate, and financial programs that are in line with the government’s economic plan.
The Code purports to promote a wider access to financial services and democratize credit in Ecuador. It also modifies legislation in order to eliminate earmarks and creates regulatory mechanisms so that the state has the necessary tools to carry out monetary policy more effectively. In addition, it rearranges the National Financial System, increases control and oversight of institutions, regulates the granting of credits, among other measures.
The bill, which aims to reduce an array of economic regulations to just one document, repeals more than 30 laws, such as the Law on Checks, The General Financial System Institutions Law, the Monetary Regime and State Bank Law.