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Mexico Peso Crisis (1994–1995): Procapte, Manuel León Hoyos
Mexico Peso Crisis (1994–1995): Procapte, Manuel León Hoyos
Journal of Financial Crises
In December 1994, Mexico entered a financial crisis. The government abandoned its crawling peg exchange rate policy, letting the peso float and devalue substantially. The recently privatized banking sector found difficulties in meeting regulatory minimum capital. The Mexican government assisted with a $52 billion international financial package, enacted multiple programs to contain the crisis. The first program introduced to recapitalize the banks was the Temporary Capitalization Program (PROCAPTE) in February 1995. Banks could issue subordinated debentures to the Bank Fund for Savings Protection (FOBAPROA). These debentures were convertible into equity shares (common stock) with voting rights after five years. Banks …
Mexico: Fobaproa Capitalization And Loan Purchase Of Bank Portfolio Program (Clpp), Manuel León Hoyos, Alexander Nye
Mexico: Fobaproa Capitalization And Loan Purchase Of Bank Portfolio Program (Clpp), Manuel León Hoyos, Alexander Nye
Journal of Financial Crises
In December 1994, Mexico entered a financial crisis after a year of political turmoil, assassinations of high-level politicians, and a substantial depreciation of the peso. In 1995, following the economic contraction, the recently privatized banking sector experienced difficulties in meeting regulatory minimum capital requirements. The Mexican government received a $52 billion international financial package and enacted multiple programs to support the banking system. In the spring of 1995, through the Bank Fund for Savings Protection (FOBAPROA), the Capitalization and Loan Purchase of Bank Portfolio Program (CLPP) was introduced to provide new, permanent capital to Mexican banks. For banks that were …
Spain: Deposit Guarantee Fund Asset Management, Manuel León Hoyos
Spain: Deposit Guarantee Fund Asset Management, Manuel León Hoyos
Journal of Financial Crises
The global oil shock in 1973-74 occurred at a time when Spain was embarking on a liberalization of its financial system that resulted in many new entrants, particularly small- and medium-sized institutions. The banking crisis that followed from 1977-85 affected 52 of the country’s 110 banks, most of them of small- and medium-sized, that comprised over 20% of bank deposits. Spain established the Deposit Guarantee Fund in November 1977 to provide limited deposit insurance, and, in March 1978, established a Banking Corporation to take control of and reorganize troubled banks. However, because the Banking Corporation lacked the legal authority to …