An extract from The Banking Regulation Review, 11th Edition


The Argentine financial system is currently composed of 62 banks and 15 financial entities (non-banks). In accordance with the last survey published by the Argentine Central Bank (BCRA), the top five financial institutions, in consideration of their total assets in 2019, are the following:

  1. Banco de la Nación Argentina, with assets of 1,279,589.3 million Argentine pesos;
  2. Banco Santander Rio SA, with assets of 572,661.1 million Argentine pesos;
  3. Banco de Galicia y Buenos Aires SAU, with assets of 569,332.5 million Argentine pesos;
  4. Banco de la Provincia de Buenos Aires, with assets of 529,876.4 million Argentine pesos; and
  5. BBVA Banco Frances SA, with assets of 399,157.5 million Argentine pesos.

In spite of major efforts conducted to strengthen the existing controls over the banking industry, to turn it into a relatively conservative system and to reduce risk exposures, there is still much work to be done, as there continues to be lack of confidence in the system among the public. Evidence of this lies in the fact the country still has below-average levels of banking inclusion (only 49 per cent according to the latest report issued by the Argentine Fintech Chamber in 2018) in comparison with other countries in the region.

In this sense, Argentine authorities and regulators have put special focus on financial inclusion, designing a national strategy for financial inclusion and issuing regulations to promote it. Among these are regulations that encourage the use of technology in the provision and development of financial services, allowing, for instance, the creation of digital wallets for the performance of instant payments or money transfers ordered through mobile devices or computers, or even the withdrawal of cash from retail stores that are regulated non-financial correspondents.

The regulatory regime applicable to banks

The Argentine banking industry is subject to strict regulations and controls, mainly provided by the Financial Institutions Law (FIL), which has been regulating banking activities in Argentina since 1977. At the same time, the FIL places the supervision and control of the Argentine banking system on the BCRA.

The BCRA is an autonomous organism in charge of enforcing all financial regulations. It is ruled internally by its Organic Chart, which determines its powers and functions as the lead regulator of the banking system.

The functions carried out by the BCRA can be categorised into two groups: all the concrete measures and actions taken to promote monetary and financial stability, which are the typical functions performed by central banks; and the regulatory faculties, which include the elaboration and enforcement of the regulations necessary to achieve its aims. Regarding its regulatory faculties, the BCRA has vested, through its Organic Chart, its supervisory powers and the enforcement of regulations enacted by it to the Superintendency of Financial and Foreign Exchange Institutions (Superintendency).

The FIL has explicitly conferred to the BCRA the following powers:

  1. granting and revoking bank licences;
  2. authorising the establishment of bank branches abroad;
  3. approving bank mergers, capital increases and certain transfers of stock;
  4. setting minimum capital, liquidity and solvency requirements and lending limits;
  5. granting credit facilities to financial institutions in cases of liquidity problems; and
  6. promulgating all the regulations that are deemed necessary for such purposes.

Regulations enacted by the BCRA are known as communications. These play an essential role in the design and control of the Argentine banking regulatory system. The BCRA is also the regulatory agent and enforcement authority of the foreign exchange market. Thus, the BCRA regulates the interaction with some other specific regimes and the effects that these have over the banking system, such as those introduced by the following regulations:

  1. the Capital Markets Act;
  2. the Anti-Money Laundering Act;
  3. the Credit Cards Act;
  4. the Data Protection Act;
  5. the Antitrust Act; and
  6. the Consumer Defence Act.