| | |  Business News | April 2009 
Mexico Senate Passes Banking Limit Bill
 Adriana Lopez Caraveo & José Enrique Arrioja - Bloomberg News
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| | (Cuartoscuro Photos) | |
The Senate approved a bill on Thursday that would allow the central bank to limit interest rates and fees that banks can charge.
The Senate approved the proposal 66-to-8, with no abstentions. The initiative will be debated in the Chamber of Deputies beginning April 21.
"Banco de México will ensure that institutions give loans or credit in accessible and reasonable conditions, and it will take corrective measures so that operations are offered under those terms," the bill says.
The measure is one of several proposals in Congress that lawmakers say are designed to boost Latin America's No .2 economy as a recession deepens in the United States, which buys about 80 percent of Mexico's exports.
Legislators say they want to help borrowers who may have trouble paying debt as a worsening economy reduces jobs and remittances from Mexicans living abroad decline.
The bill doesn't specify a maximum interest rate. Instead, it calls for policymakers to cap interest rates if they are deemed to be too high or if they prevent low-income Mexicans from obtaining credit.
The legislation would prohibit banks from charging fees that "distort healthy banking practices," according to the initiative. Under the measure, banks wouldn't be able to charge fees for consulting account balances at bank branches.
Guillermo Zamarripa, director of the Finance Secretariat's banking and savings unit, and Enrique Castillo, president of Mexico's Banking Association, said last month that they disagreed with a set limit on rates.
The four largest banks in in Mexico in terms of total assets are foreign-owned firms Fitch Ratings said in a September report: BBVA, Citigroup, Banco Santander and HSBC.
Grupo Financiero Banorte, Mexico's largest publicly traded lender, is the fifth-largest bank, according to Fitch. |
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