Banking crises ask for fast and tough action, but they can never be overcome by loosening monetary policy and abandoning the rules of the game and all the necessary restrictions, because in this way you can only jeopardise macroeconomic stability and create additional problems. Venezuela can teach us a good lesson with respect to this. One can detect a certain disappointment with foreign banks. They are entering the market with minimum capital and are only going for multinational clients, and so are not really contributing to improving the domestic banking system. This is a crucial issue.
Competition is very important in every market.
But unlike other people who promote unlimited competition in the banking sector as in other industries, I must say that I am a little bit more cautious in this area. When you give your money to a bank, you only get the promise that they will manage it in a careful and prudent manner. Therefore, credibility and quality in the banking sector are much more important and sensible issues. It is not enough to have a large number of banks and let the clients choose the best among them. To sum up, I do support increased competition in the form of foreign banks, but at the same time I strongly advise exercising due caution and enforcing appropriate regulations.