CARACAS, Venezuela -- Venezuelan President Hugo Chavez warned private banks on Sunday that he will consider nationalizing any that refuse to finance agricultural projects promoted by his government.
| Translation: despite all the oil, he's running out of money. |
| To be fair, it appears he's running out of oil, too. |
Banks are required by law in Venezuela to provide at least 10 percent of their lending to finance government development projects.
"The private banks that do not comply with the constitution and their duty, well, I do not have any problem nationalizing them," Chavez said during his weekly radio and television program. "We must ensure the constitution and laws are complied with!"
Chavez charged that the rules aren't being followed by some of Venezuela's biggest private banks -- Banesco, Banco Mercantil and Banco Provincial, which is controlled by Spain's Banco Bilbao Vizcaya Argentaria. Chavez singled out the president of Banesco, Juan Carlos Escotet, ordering him to lend more to Venezuela's cash-strapped farmers.
"If you cannot do it, give me your bank," Chavez said, prompting applause from a crowd of government officials and supporters.
A bill approved last year by Chavez's allies in the National Assembly describes banking as a "public service" and gives the government the authority to declare banks to be of "public utility," which paves the way for state nationalizations.
The government already seized control of about a dozen banks in recent years, accusing them of causing financial problems and violating banking rules. Chavez's government controls about 28 percent of Venezuela's banking sector.
| And yet there's no money. Wonder why? |
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