Best bank - Banco de Venezuela
Best local partner - Banco Mercantil
Best debt house - Citigroup
The top four banks in Venezuela all made pretty healthy profits in 2002, but none made more than Santander-owned Banco de Venezuela. Its return on equity, at 38.6%, was the second highest in all of Latin America, and its efficiency ratio dropped from 49.4% in 2001 to just 40.4% in 2002.
Even so, there's not much to choose between Banco de Venezuela and the winner of our local partner award, Banco Mercantil, one of the best-run domestically owned banks in Latin America, and an institution that itself posted more than 38% in return on equity and more than $150 million in profit.
In fact, there's little the Venezuelan banks can do in terms of charting their own course. Under president Hugo Chávez it is a country where anything can happen. If Chávez wanted to he could easily go after the banks. It's anybody's guess whether being foreign-owned is an advantage or a disadvantage in the eyes of the president. So the story of the Venezuelan banking system is going to be one of extreme uncertainty unless or until Chávez leaves office.