Accendo Banco Loses LicenseBy Emilio Aristegui | Fri, 10/01/2021 - 12:28
After several accusations of malpractice, Mexico’s Ministry of Finance and Public Credit (SHCP) revokes Accendo Banco’s operating license and will liquidate its assets to protect the savings of the bank’s clients.
“As a result of the observations made by financial authorities the Capitalization Index (ICAP) of Accendo Banco was below the minimum regulatory levels, which constitutes a cause for revocation to operate as multiple banking institution, in accordance with the provisions by article 28, section V, of the Credit Institutions Law (LIC),” reads SHCP’s press release.
The Institute for the Protection of Bank Savings (IPAB) informed Accendo’s clients of the bank’s status change and the measures they should take to recover their savings in the banks’ website. “Derived from the revocation of the authorization to organize and operate as a multiple banking institution of Accendo Bank S.A. by the National Banking and Securities Commission, the IPAB began on September 29, 2021, the Payment of Guaranteed Obligations to savers of Accendo Bank.”
IPAB also announced the that legal actions would follow and told users that their savings would be restituted. “The severs of Accendo Banco S.A. can be confident that their deposits are protected by up to 400,000 UDIS per person in the bank, which as of today is equivalent to MX$2.77 million (US$134,659).”
The restitution would not impact public finances, added SHCP, and are also not “a financial rescue of a private institution or shareholders.”
Accendo Banco’s assets represent 0.08 percent of Mexico’s the total financial system, so their liquidation does not represent a risk. As the SHCP highlights, “The banking system in Mexico has sufficient capitalization and solvency to provide security for the savings of Mexican depositors.”
Even though many were concerned after Accendo’s bankruptcy, SCHP was quick to calm customers and investors. “This event is an isolated case that will not affect the economic recovery of the country and does not represent a risk for the stability of the banking system, which maintains adequate levels of capitalization, liquidity and solvency.”