TASS, August 20. The vast majority of Venezuelan private and state-owned banks have begun work under the conditions of a denomination that began on Monday. This was announced by Executive Vice President Delsey Rodriguez. “Already 92% of electronic platforms of both state and private banks operate, even on weekends, and soon after the start of work, more than 400 thousand operations were carried out in the branches,” Rodriguez quoted Union Radio. The vice president also expressed confidence that the measures taken by the authorities will improve the economic situation in the country. During the denomination, five zeros were removed from the banknotes; the new currency – the sovereign bolivar – was linked to the Petro Banco de Venezuela cryptocurrency. Its cost is equal to the price of a barrel of oil produced in the country and is about $ 60. Before embarking on the reform, Venezuelan President Nicolas Maduro announced a September 60 increase in his minimum wage to 1,800 sovereign bolivars (180 million at the old rate, hereinafter TASS) and linking it to Petro.
Top Banks in Venezuela
Banco de Venezuela
Nacional de Credito
Almost 60 sovereign bolivars (6 million at the old rate) are offered on the black market for the US dollar in Venezuela, while the official rate is ten times lower. In recent years, Venezuela has been experiencing an acute socio-economic crisis, accompanied by skyrocketing prices and the devaluation of the Bolivar. According to the latest estimates of the parliamentary finance committee, in July, annualized inflation amounted to almost 83,000%. The IMF predicts inflation at one million percent by the end of the year. Official data on price increases in the country have not been published for several years.
Russia sent more than 315 million cash dollars and euros to Venezuela, Bloomberg reports from its own investigation. According to journalists, from May 2018 to April 2019, at least six money transfer operations were completed. Cash dollars made it possible for the Venezuelan authorities, which are under US sanctions and do not have access to the international financial system, to circumvent restrictions on international trade. Bloomberg’s findings are based on data from ImportGenius, the Russian customs system that tracks information from individual importers. Cash went to the Venezuelan Development Bank. Journalists admit that Banco de Venezuela could receive this money for the sale of oil or its “gold reserves” placed in foreign banks.
Cash supply operations to Banco de Venezuela, according to their data, began in May 2018. In May and July 2018, two tranches totaling $ 55 million were sent to Venezuela from Russia, but Bloomberg does not report in which currency. In January 2019, 113 million euros were sent to Venezuela from the state-owned Gazprombank in a couple of days in banknotes of 100 euros and 50 million dollars in cash. In April 2019, $ 97 million in cash was sent from Moscow to Venezuela. The sender from the Russian side was Eurofinance Mosnarbank, which until March 2019 was owned by Gazprombank. At the same time, on March 11, 2019, it became known that Eurofinance Mosnarbank was included in the US sanctions list due to ties with the state-owned Venezuelan oil company PDVSA. The recipient of the money on the side of Venezuela was the Banco de Desarrollo Economico y Social de Venezuela (Bandes). It is also under US sanctions.
In January 2019, at the height of these operations, the head of the Venezuelan parliament, Juan Guaido, declared himself acting president of the country amid mass protests. Guaido was recognized as the legitimate head of state of the United States, Canada, and many other Western countries. At the same time, Russia, Turkey, and China continued to consider President Nicolas Maduro. Soon after, the United States imposed sanctions on the Venezuelan oil company PDVSA and banned the purchase of its products, as well as further strengthened financial sanctions against the authorities of Banco de Venezuela.