Bank of the Year, Bolivia: Banco Nacional de Bolivia

Nov 1, 2013

Bolivian lawmakers have ushered in changes that have hurt banks’ profitability. More pain is in store

Bolivia’s banking system has been transformed by its government over the past few years. That’s both good news and bad. Good in that opportunities are still plentiful if the economy continues to grow. But profits have suffered: the country’s largest banks’ return on equity (ROE) has fallen from around 20%, to 11%, between 2006 and 2011.

Agents for change have come in two forms. The first was a new tax system that came into force at the end of 2011. The second is a new set of financial services laws, approved in August, which were set to come into effect in November. And then there are market forces.

"The competition is tougher than it used to be," says Fernando Albano, an analyst at Moody’s. "This hit profitability in the whole system."

In 2011, the government increased a tax on profits for the highest-earning banks, from 25%...

To continue reading please take a free trial, subscribe or login below.

Already have an account?


Subscribe now for unlimited access to all current and archive news, data and market analysis. 


Free trial

Take a free two-week trial now for the latest news, data and market analysis.

Free Trial

Upcoming Events


Where will capital markets be busiest in 2017?


Popular Searches