Just a quick note for regular readers to explain my recent ‘silence’. I am in Mexico City, invited by Adalberto Palma, CEO of UNIFIM (a confederation of Mexican owned financial institutions, and IMEF (the Mexican Institute of Finance Executives), to participate in the current debates on Mexico’s forthcoming financial sector reforms.
A major tussle has been developing between (A) the systemic, foreign owned banks, which dominate Mexico’s financial sector – but who at the same time starve the Mexican economy of credit, and (B) the smaller Mexican financial institutions which, despite their small size are providing disproportionately large quantities of credit to Mexican small and medium sized firms. Meanwhile the government seems determined to introduce regulatory reforms that treat the two groups equally, thus seriously undermining the Mexican financial institutions’ ability to carry on providing much needed credit services to the Mexican economy.
Yesterday, I addressed three different audiences of professionals, regulators, academics and students on the need to restrict the oligopoly power of Mexico’s foreign owned SIFIs (systemically important financial institutions) while nurturing the Mexican-owned smaller institutions. Next Sunday I shall post my keynote speech on this matter (text and audio) – so watch this space. Till then, the silence will continue as I work my way through from one meeting and one interview to another.