March 19, 2013 / 12:05 AM / in 5 years

Ecuador orders small bank to suspend operations

QUITO, March 18 (Reuters) - Ecuador’s banking regulator on Monday ordered one of the smallest banks in the Andean country to suspend operations due to solvency and liquidity problems.

The Territorial Bank currently has assets worth $170 million. Ecuador’s banking system had total assets worth nearly $28 billion by the end of 2012.

Pedro Solines, the head of the country’s banking superintendence told reporters that two banks are interested in acquiring Territorial Bank’s assets and liabilities.

“We’re expecting more offers ... we hope to talk with five or six banks,” he said, adding that the Territorial Bank’s collapse is unlikely to affect other banks due to its small size and the good health of the country’s banking system.

The assets of private banks increased 16.8 percent last year compared with 2011. There were 29 banks operating in Ecuador at the start of the year.

Solines said the Territorial Bank had been experiencing financial difficulties since mid-2009 and that the superintendence had given its owners three years to solve the bank’s problems.

According to state-run news media, the Territorial Bank had 75,000 clients, and 99 percent of them had deposits of less than $31,000. The government insures deposits of up to $31,000. (Reporting By Eduardo Garcia; Editing by Carol Bishopric)

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