Argentina to Freeze Dollar Term Deposits
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Argentina will ban withdrawals of dollar term deposits until 2003 to avert a collapse of the banking system, Todo Noticias reported. The decision will affect about $23 billion in deposits, economists said.
The government, which has ordered banks to convert dollar-denominated loans totaling as much as $100,000 into pesos to help individuals cope with a devaluation of the currency, is taking steps to help banks that otherwise would be unable to meet their dollar liabilities, analysts said. Central bank officials wouldn’t comment.
Argentines pulled almost $16billion in dollar-denominated term deposits from banks in the two months leading up to the withdrawal restrictions.
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