Private banks in Venezuela

If I am a bank and one day all my debtors become insolvent and offer me their assets as collateral, I do not accept it, why?

Because the bank formally, legally and by the nature of the business performs financial intermediation operations, credits, the merchandise is the money itself and the price is the interest rate. Then a bank that receives goods of all kinds would go bankrupt in such a situation..

Banks have been doing transactions with public debt bonds for many years, and very short term credit operations with fiduciary guarantees of all kinds. I am not up to date with what they are doing in Venezuela at the moment, at this bizarre juncture..

But to get an idea of the fate of the bulk of the money in private banking, I am reminded of the famous "OVER NIGTH" rate, which was a very high interest rate used for night banking operations, related, among other things, to loans between banks and clearinghouse checks..

And so on, various operations are carried out that are not orthodox credit intermediation but that, due to a very strange legal and institutional framework, were and still are allowed, but the volume of bolivars that pass through the banks with hyperinflation is so large that here credit and interest rates do not have an impact and do not lose any of their value..

I do not know how private banks in Venezuela are suffering in their balance sheets and financial statements at the moment, but nobody is talking about it. In any case, banking is virtually intervened, not nationalized. Pure sophistry, banking is a sophisticated business, prone to fallacy and a lot of abstraction.