Venezuelan banking crisis of 1994

The 1994 banking crisis occurred in Venezuela when a number of the banks of Venezuela were taken over by the government. The first to fail, in January 1994, was Banco Latino, the country's second-largest bank. Later, two banks accounting for 18% of total deposits (Banco Consolidado and Banco de Venezuela) also failed.[1] On 9 August 1994, Banco de Venezuela became the tenth bank bailed out by the Venezuelan government during the crisis, with the government taking a majority stake for an estimated at US$294m.[2] In total, between January 1994 and August 1995 17 of the country's 49 commercial banks, as well as some subsidiaries, failed - representing 53% of the system assets.[3] Estimates of the total cost of the bailout range from 18 to 31% of GDP;[4] one estimate gives the total cost of the bank bailouts as 1.8 trillion Bolivars, or $12bn.[1]

Financial liberalisation in the early 1990s and lax banking supervision had laid the seeds for the crisis, which was then triggered by the cumulative effects of a collapse in the oil price, which led to sharply reduced government spending and weakened the Venezuelan economy.[1]

Ruth de Krivoy, who was President of the Central Bank of Venezuela at the height of the crisis in 1994, later published a book on the episode.[5]

References

Molano, 1997. Financial reverberations: the Latin American banking system during the mid-1990s. SBC Warburg Working Paper, Social Science Research Network (1997).
"Veneuela (sic) Announces Bank Rescue Package". New York Times. August 10, 1994. Retrieved 2009-01-13.
Molina, C.A. (2002), "Predicting bank failures using a hazard model: the Venezuelan banking crisis", Emerging Markets Review, Volume 3, Issue 1, 1 March 2002, Pages 31-50
Maxfield, Sylvia (2003), "When do voters matter more than cronies in developing countries? The politics of bank crisis resolution", in Critical issues in international financial reform (R. Albert Berry, Gustavo Indart, eds.), Transaction Publishers, p272
Da Costa, Mercedes (2001), Collapse: The Venezuelan Banking Crisis of '94, Finance & Development, 1 March 2001

Financial crises
Banking panic Bear market Commodity price shocks Credit crunch Credit cycle Currency crisis Debt crisis Energy crisis Flash crash Hyperinflation Liquidity crisis Minsky moment Stock market crash
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1840–1870	European Potato Failure (1845–1856) Great Irish Famine Highland Potato Famine Panic of 1847 Panic of 1857 Panic of 1866 Black Friday (1869)
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1982–2007	Steel crisis (1982–1988) Brazilian hyperinflation (1982–1994) Souk Al-Manakh stock market crash (1982) Chilean crisis of 1982 1983 Israel bank stock crisis Black Saturday (1983) Savings and loan crisis (1986–1995) Black Monday (1987) 1988–1992 Norwegian banking crisis Friday the 13th mini-crash (1989) Japanese asset price bubble crash (1990–1992) 1990 oil price shock Rhode Island banking crisis (1990–1992) 1991 Indian economic crisis 1990s Swedish banking crisis (1991–1992) 1990s Finnish banking crisis (1991–1993) 1990s Armenian energy crisis (1991–1995) Cuban Special Period (1991–2000) Black Wednesday (1992) Yugoslav hyperinflation (1992–1994) 1992 Colombian energy crisis 1994 bond market crisis Venezuelan banking crisis of 1994 Mexican peso crisis (1994) 1997 Asian financial crisis October 27, 1997 mini-crash 1998 Russian financial crisis 1998–99 Ecuador financial crisis Samba effect (1999) California electricity crisis (2000–2001) Dot-com bubble crash (2000–2004) 2001 Turkish economic crisis 9/11 stock market crash (2001) Stock market downturn of 2002 South American economic crisis of 2002 2002 Uruguay banking crisis 2003 Myanmar banking crisis 2000s energy crisis (2003–2008) 2004 Argentine energy crisis Nigerian energy supply crisis (2005–) U.S. housing market correction (2006–2007) 2007 Chinese stock bubble crash Zimbabwean hyperinflation (2007–)
2007–2009	Financial crisis of 2007–2008 2008 Bulgarian energy crisis 2008 Central Asia energy crisis 2008 Latvian financial crisis 2008–2009 Belgian financial crisis 2008–09 Russian financial crisis 2008–2009 Ukrainian financial crisis 2008–2011 Icelandic financial crisis 2008–2011 Irish banking crisis 2008–2014 Spanish financial crisis European debt crisis Greek government-debt crisis Subprime mortgage crisis U.S. bear market of 2007–2009
2009–2020	2009 Ecuador electricity crisis 2009 Dubai debt standstill Venezuelan banking crisis of 2009–2010 2010 flash crash 2010–2014 Portuguese financial crisis Energy crisis in Venezuela (2010–) 2011 Tōhoku earthquake and tsunami stock market crash August 2011 stock markets fall Black Monday 2011 Bangladesh share market scam 2012–2013 Cypriot financial crisis 2013 Chinese banking liquidity crisis Venezuela economic crisis (2013–) Gaza electricity crisis (2013–) 2014–2016 Brazilian economic crisis Puerto Rican government-debt crisis (2014–) 2014–2017 Russian financial crisis 2015–2016 Chinese stock market turbulence 2015–2016 stock market selloff Zulia energy collapse (2015–) Brexit stock market crash (2016) 2016 Southeastern U.S. gas shortage Venezuelan hyperinflation (2016–) 2017 Sri Lankan fuel crisis Ghana banking crisis (2017–2018) 2018 cryptocurrency crash 2018 Turkish currency and debt crisis Lebanese liquidity crisis (2019–)
2020–present	2020 stock market crash 2020 Russia–Saudi Arabia oil price war
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Venezuelan banking crisis of 1994

References

Further reading