President Hugo Chavez’s government assumed control of Venezuela’s third-largest bank on Friday – making the state the largest player in the nation’s banking system.
The purchase of the Spanish-owned Banco de Venezuela gives Chavez’s socialist government control over more than one-fifth of bank deposits as he tightens his grip over the economy.
The acquisition will “strengthen the public banking system,” which favors sectors including agriculture, energy, housing and tourism, Finance Minister Ali Rodriguez said in a statement.
…Combined with other state banks, the government will now control about 21 percent of deposits and 16 percent of loans, a payroll of 15,000 employees and 651 bank branches.
…Like the rest of the economy, Venezuela’s banking sector is already highly regulated, with the government dictating interest rates and commissions.
Under Chavez, Venezuela has nationalized major players in the steel, electricity and other sectors, including four major oil projects, since 2007.
The Venezuelan consulting firm Ecoanalitica calculates those nationalizations have cost Chavez’s government some $23 billion.
Things are so much more efficient when no one owns anything except the state bureaucrats. Look how well the Soviet Union did.