In spite of a hostile government and an overcrowded and ferociously competitive market, Bolivia’s banks are set to turn in one of their strongest ever sets of annual results. The banks are in confrontation with the leftist government of Evo Morales, a populist leader who is calling for a cut in loan rates and an increase in interest paid on deposits, a tactic he knows will be well received by the indigenous population and Bolivia’s poor, his main constituency.
So far these measures have remained in the realm of political rhetoric, but there is the ever-present threat of Mr Morales putting his demands into practice. Bankers complain that the government is reluctant to even hear their case. “It is almost impossible to have a meeting with the politicians, who are simply not interested in listening to our side of the story,” says the CEO of one bank in La Paz.
