The material on this site is for financial institutions, professional investors and their professional advisers. It is for information only. Please read our Terms & Conditions, Privacy Policy and Cookies before using this site. Please see our Subscription Terms and Conditions.


All material subject to strictly enforced copyright laws. © 2021 Euromoney, a part of the Euromoney Institutional Investor PLC.
Banking

Argentina: Galicia’s Grinenco looks through the regulatory lens

The outside world is still happy to see the market-based reforms in Argentina through rose-tinted glasses, but the country’s banks are battling a poor economy and tough regulatory challenges. Banco Galicia’s chairman, Sergio Grinenco, has a pragmatic view of the outlook for Argentina’s banks.

Sergio Grinenco-400

Illustration: Pete Ellis

The view from the top of Banco Galicia’s tower is changing, but only slowly. Much of what can be seen has been the same for decades, but there are pockets of obviously recent development. 

The tower where Galicia’s chairman Sergio Grinenco sits dates from the turn of the millennium, when stringent dividend regulation favoured capital investment strategies. Now the forecast is for more orthodox investment that will drive new economic growth. Some investment has begun, but game-changing levels of it have yet to materialize.

The new administration inspired a recession. It had to, given the need to dismantle the many distortions and imbalances it inherited. Economic growth may be coming, but the country is still waiting for unambiguous signs of a breakthrough.

While it waits, the banks face a difficult path to normalization. The macroeconomic situation has created an environment of negative real loan growth, rising unemployment and pressure on (admittedly high) net interest margins (NIMs). More surprising is the persistent negative impact of regulatory risk. President Mauricio Macri has dismantled some of the core regulatory frustrations of the banking sector but maintained – and in some cases even increased – others. 

You have reached premium content. Please log in to continue reading.

Read beyond the headlines with Euromoney

For over 50 years, our readers have looked to Euromoney to stay informed about the issues that matter in the international banking and financial markets. Find out more about our different levels of access below.

SUBSCRIBE ONLINE TODAY

Unlimited access to Euromoney.com and Asiamoney.com

Expert comment, long reads and in-depth analysis interviews with senior finance professionals

Access the results of our market-leading annual surveys across core financial services

Access the results of our annual awards, including the world-renowned Awards for Excellence

Your print copy of Euromoney magazine delivered monthly

£73.75 per month

Billed Annually

FREE 7 DAY TRIAL

Unlimited access to Euromoney.com and Asiamoney.com, including our top stories, long reads, expert analysis, and the results of our annual surveys and awards

Sign up to any of our newsletters, curated by our editors

LOGIN NOW

Already a user?

We use cookies to provide a personalized site experience.
By continuing to use & browse the site you agree to our Privacy Policy.
I agree