Cleaning house.

All the chickens came to roost this year for Argentina's bushwhacked financial system. The forced conversion of dollars to pesos following the late 2001 economic collapse hurt--a lot.

As LATIN TRADE predicted last year, the ugliness could only continue for the beleaguered Southern Cone country's banking sector as it digs out from its historic US$141 billion government default. Although legal actions continue, it seems unlikely that the government will be forced to pay back billions erased virtually overnight.

Thus Banca Nazionale del Lavoro's net income for 2002 is on practically another scale, falling 169,000% on a 58% slip in assets and a 79% decline in loans. Loans and deposits for many of the country's banks, including the large multinational banks like Citibank and Banco de Galicia y Buenos Aires, skidded as well. Such is the price of mopping up the mess.

It may well be, as analysts have noted, that the performance of a given bank has more to do with the country's performance than the bank itself. That's a clear lesson in Argentina, where a spendthrift government dragged under unwilling financiers.

Brazilian banks, meanwhile, are fighting their way back from what had been the depressing effect of the left-wing candidacy of Luiz Inacio Lula da Silva. The numbers will improve in 2003, as did opinions of Lula once he took office. But that's for next year.

WINNERS & LOSERS

Scorecard of who's news in the bank rank

Percent change 2001 vs. 2002

ASSETS (% CHANGE '01/'02)
                         DEUTSCHE BANK, CHILE        169
                          BNP PARIBAS, PANAMA         96
                               BANERJ, BRAZIL         95
                              BANORTE, MEXICO         69
                          I.N.G. BANK, MEXICO         29
BANCO DE LA CIUDAD DE BUENOS AIRES, ARGENTINA        -55
                      BANKBOSTON N.A., BRAZIL        -56
        BANCA NAZIONALE DEL LAVORO, ARGENTINA        -58
                        BANKBOSTON, ARGENTINA        -64
                          CITIBANK, ARGENTINA        -70

LOANS (% CHANGE '01/'02)
                         DEUTSCHE BANK, CHILE        394
                          I.N.G. BANK, MEXICO        117
                              BANORTE, MEXICO         60
                                BITAL, MEXICO         59
                  BANCO INDUSTRIAL, GUATEMALA         32
                          HSBC BANK ARGENTINA        -69
                          CITIBANK, ARGENTINA        -72
        BANCA NAZIONALE DEL LAVORO, ARGENTINA        -79
                        BANKBOSTON, ARGENTINA        -81
                  JP MORGAN CHASE BANK, CHILE        -87

DEPOSITS (% CHANGE '01/'02)

               BANCO SANTANDER BOZANO, BRAZIL        797
                      LLOYDS TSB BANK, BRAZIL        182
                         DEUTSCHE BANK, CHILE        105
                          BNP PARIBAS, PANAMA        102
                               BANERJ, BRAZIL         77
                 BANCO HIPOTECARIO, ARGENTINA        -78
   BANCO DE GALICIA Y BUENOS AIRES, ARGENTINA        -79
                        CITIBANK N.A., BRAZIL        -90
                      JP MORGAN CHASE, BRAZIL        -92
                      BANKBOSTON N.A., BRAZIL       -100

NET INCOME (% CHANGE '01/'02)

                  JP MORGAN CHASE BANK, CHILE      6,372
                       BANCO CONAVI, COLOMBIA        714
                  BANCO BILBAO VIZCAYA BRASIL        537
                             CITIBANK, BRAZIL        518
                      JP MORGAN CHASE, BRAZIL        420
   BANCO DE GALICIA Y BUENOS AIRES, ARGENTINA     -4,358
             BANCO RIO DE LA PLATA, ARGENTINA     -5,520
                               BLADEX, PANAMA    -10,895
                          CITIBANK, ARGENTINA    -19,469
        BANCA NAZIONALE DEL LAVORO, ARGENTINA   -168,600

Note: Table made from bar graph.