On 21 January 2021, the Office of the National Superintendent for Banking Sector Institutions (SUDEBAN) issued a notice that prohibits banking institutions from carrying out credit operations using foreign currency, without prior authorization from SUDEBAN and the Central Bank of Venezuela (“BCV”) (“Notice“).1
The Notice refers to the definition of credit established in the Banking Sector Institutions Law2 as operations carried out solely in the national currency, including financial leasing, invoice discounting, letters of credit, discounts, advances, reports, guarantees and any other financing modalities or active operations carried out by banking institutions.
The Notice prohibits banking institutions from granting credits in foreign currency with resources obtained from funds deposited by the public in foreign currency or any other modality. If banking institutions wish to carry out credit operations in foreign currency, they need the express authorization of the BCV and SUDEBAN to do so.
1 Notice No. SIB-DSB-CJ-OD-00317 of 21 January 2021, issued by the Superintendence of Banking Sector Institutions (SUDEBAN).
2 Decree with Rank, Value and Force of Law of Banking Sector Institutions, Article 58 (1): “For the purposes of this decree with rank, value and force of law, these concepts will be understood as follows:
1. Credit: all operations in the national currency that comprise financial leasing, invoice discounts, credit letters, discounts, advances, reports, guarantees and any other financing modality or active operations made by banking institutions.”