1998–99 Ecuador banking crisis

The 1998–99 Ecuador banking crisis resulted in about 70% of the country's financial institutions closing. In 1999, economic activity decreased by 7–8% and the currency depreciated by 195%.^[1] Per-capita income in US dollar terms plummeted by 32% during the year.^[1] Unemployment increased from 9% to 17% and underemployment increased from 49% to 55%.^[1] 1.6 billion dollars of Government of Ecuador funds were used to bail out banks that failed as a result of corrupt practices and mismanagement.^[1] The money supply increased at an annual rate of 170% to pay back depositors of failed banks.^[1] In March 1999, the government froze bank deposits to avoid hyperinflation.^[1] By the end of 1999, President Mahuad's approval rating had dropped to 9%.^[1] Unresolved economic, financial and political problems led to massive protests that resulted in his departure from office on January 22, 2000.^[1]

Further reading

• "Bank Crisis Leaves 4,360 Unemployed". Business News Americas (August 10, 1999).
• Central banks and financial crises: Lessons from recent Latin American history.
• The political economy of the Ecuadorian financial crisis.
• Managing systemic banking crises
• AGD drafts law to create new deposit insurance system.
• Official Dollarization and the Banking System in Ecuador and El Salvador
• The Late 1990s Financial Crisis in Ecuador: Institutional Weaknesses, Fiscal Rigidities, and Financial Dollarization at Work (PDF).

References

Ecuador topics History Gran Colombia Ecuadorian–Peruvian War Paquisha War Cenepa War 1998–1999 banking crisis Economic history 2010 coup d'état attempt and crisis Geography Birds Cities Climate Environment Islands Mammals Mountains National parks Provinces Rivers Volcanoes Politics Constitution Tribunal Elections Foreign relations LGBT history Military National Congress Political parties President Vice President Economy Banking Central Bank Coffee production Currency Mining Telecommunications Trade unions Transport airports railways Water supply and sanitation Society Crime Demographics Education Health Religion Social class Culture Cinema Cuisine Dishes and foods Flag Indigenous peoples Newspapers Music Notable people Public holidays Sport Smoking Television Outline Index Category Portal WikiProject