ECUADOR - Finance
General Manager, Banco Pichincha
Santiago Bayas Paredes was appointed General Manager of Banco Pichincha in 2018 after previously serving as Executive Vice President of Finance & Risk. He also served as Vice President of the Treasury.
Banco Pichincha is the largest bank in the country, and we work in every segment in Ecuador, from the largest corporations to micro-entrepreneurs in small communities. There are synergies between corporations and other suppliers, and we want to work with the entire supply chain, which helps us better serve our clients and assess credit risk. We have the largest network in the country and have a presence in every province.
In the last year, we have seen more demand for financing capital investments. In previous years, they were demanding just working capital, now they are investing to increase productivity, automatize logistics, and improve and renew technology to reduce costs. We have seen investments in shrimp, cement, retail, and mining since the legal changes were put in place. In the mining sector, large companies are entering the country, which is something new because before we just had small-scale mining. For the bank, it is important to see our clients trying to grow and innovate, and given our solid deposit base, we can afford to lend for the long term.
Entrepreneurship is something the country needs to support. There are limited funds to promote entrepreneurship, and in the case of the group, this kind of work is done through our NGO.
The banking law is not that friendly to investors; there are still too many restrictions. For example, in terms of ownership, a shareholder of a bank cannot have any other business. The capital outflow tax is in practice a restriction on foreign investors entering the country. We do not have international banks here, nor do we have much foreign investment. We need legal reforms to make the landscape friendlier for foreign investors.
Actually, there have been no changes in the regulation of the financial sector, though there are certain incentives for local and foreign investors that would help the overall situation of the country. Something that helps banks and local firms get additional financing is legislation that eliminates the capital outflow tax on external financing for tenures longer than one year, even if they come from what according to Ecuadorian law is a tax haven. In general, there is now a different environment for the private sector, which we expect to take the lead in terms of growing the economy, as opposed to the previous 10 years, when public expenditure created a lot of distortionary growth.
This has been favorable to the country and given us greater stability. It helps the country focus on real sector productivity, not just financial variables. It helped the country stand despite a negative overall economic policy. The other important thing is having a longer-term vision; for example, people used to only be able to get a five-year mortgages, making it difficult to afford a house. Now, the tenure is 15-20 years.
The great thing about the digital world is that it helps us be more customer-centric. In 2018, we launched an application for credit and opening accounts. However, a large number of our clients come to our branches, so the challenge is to use digitalization to reduce the time it takes to open an account. We even have a mobile app that works with facial recognition, among other projects. Analytics is another important area in which the use of artificial intelligence and all the information we have from our clients comes in handy.
ECUADOR - Real Estate & Construction
General Manager, Uribe & Schwarzkopf (US)
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