August 12, 2019 / 11:58 PM / 6 months ago

Ecuador central bank seeks regain autonomy with new law -official

CARACAS, Aug 12 (Reuters) - Ecuador’s central bank hopes to recover its autonomy, which has weakened over the last decade, through the approval of a new law and an injection of cash from the International Monetary Fund (IMF), a central bank manager said in an interview on Monday.

During the government of former President Rafael Correa the central bank became a source of financing for the government by buying some $6 billion in debt and handing over profits, and stopped serving as a technical adviser to the government.

Advisors to President Lenin Moreno, a former Correa ally turned rival, plan to deliver a proposal to the legislature in September that will allow the central bank to receive part of a $4.2 billion IMF financing package.

“Once the central bank law is passed, the institution will have to be capitalized with $100 million and that gives us strength,” central bank manager Veronica Artola told Reuters.

The bank needed more liquid assets to cover liabilities, she said.

Artola also said the new central bank law forms part of the agreement that Ecuador reached with the IMF. The legal proposal will be delivered to the National Assembly at the end of September for approval. (Reportin by Alexandra Valencia, writing by Brian Ellsworth, editing by G Crosse)

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