Loans with money laundering divide banks and revive old controversies

The possibility of a significant exchange rate jump is not part of the scenario for the dollar at the end of the year, but December leaves news.

This month, unlike previous ones, the rise in free dollars beat the interest rate in pesos. A 10% increase in four wheels It surpassed the performance of placements in pesos for four months.

December’s result does not overshadow that of the year. The consulting firm 1816 maintains that “since it took over Javier Miley be invested in Badlar rate (average 30-day fixed term) returned 54% to the cash dollar with settlement (CCL)but the most interesting thing is that the first period closes with negative carry trade since July“.

The rise of the dollar was not, this time, the response to a framework of distrust but to market issues that reflect the “fine” of financial management in the face of a drop in inflation and the announcement by Minister Luis Caputo in the Stock Exchange that The rate of increase of the official dollar will decrease from 2% to 1% monthly. The latter, in the event that the 2.4% increase in the cost of living from November is repeated in December.

Part of the process of financial transformation that Argentina is experiencing gained strength with the proposal of a group of national capital banks to expand the possibilities of placement of money laundering that came to generate deposits for US$ 21,000 million.

Part of those dollars have already left the system, but since mid-August foreign currency deposits increased US$ 13,000 million which, in turn, generated loans of US$3.3 billion.

For national bankers, the potential to generate loans with these deposits outweighs the risk of falling into a situation of “coin mismatch”as in 2001, when loans in dollars, due to devaluation, became unpayable by borrowers who earned in pesos.

The proposal of these banks is to generate financing in foreign currency in a limited manner for medium-sized companies that today do not have access to this type of loans, since today they are reserved for companies that, due to their activity, generate dollars.

Foreign banks oppose breaking that rule that was successful in rebuilding trust in the system of deposits and credits in dollars that, after the “corralito”, had been seriously damaged.

The temptation to generate business with US$13,000 million is great and it grows in a context in which officials insist that Argentina is heading towards a bimonetary scheme with free circulation of dollars.

Foreign banks emphasize that those dollars belong to the depositors and currency risk is always cyclically dangerous in Argentina.

In fact, another fact that the 1816 report highlights is that the real exchange rate measured by the CCL had a sensitive appreciation due to the strong devaluation of the Brazilian real.

The money laundering dollars, added to the appreciation of the peso (which according to Domingo Cavallo is “exaggeratedly appreciated”) and President Javier Milei’s advance that more dollars will come from the IMF generate a feeling of high confidence about the progress of the external sector.

The climate of exchange placidity with celebration in the markets contrasts with the upward pressure of the dollar in the US. which is hitting commodity prices (soybeans at US$ 358 per ton) and the devaluation of the real that cloud the external front.

In this framework, Federico Furiase, director of the Central Bank, was in charge of telling the directors of the Stock Exchange that the possibility of increasing loans in dollars is another step towards “endogenous dollarization” that the Government will try to consolidate from the start of 2025.

The course appears marked and firm, and the laundering dollars, in addition to consolidating the decline in free dollars and serving as a source of financing for large companies that placed Negotiable Obligations, Now they could be used as credit for medium-sized companies and that, with their activity, they do not generate dollars.

Another bet by Minister Luis Caputo in the attempt to make it clear that change and the path to dollarization are inexorable.