Banks, IESS talks reach impasse

An impasse has been reached in talks between Ecuador's banks and local social security agency IESS designed to determine whether the banks will participate in the handling of the agency's latest mortgage package, local daily El Universo quoted IESS executive Bruno Frixone as saying. Ongoing talks between Frixone and the banks' representatives have reached a stalemate after nearly four months, leaving 20,000 approved mortgage loan reciprocates awaiting their promised loan, the paper added. The IESS signed an agreement last week with four mutual funds (Pichincha, Benalcazar, Imbabura and Azuay) and one cooperative (Cacpeco) allowing them to administer the agency's latest lending package. Three banks (Pichincha, Machala y Solidario) returned unsigned the document outlining the terms and conditions of the agency's mortgage lending package effectively confirming their withdrawal from the project. IESS recently unveiled a plan to cut operational costs - such as overtime pay, telephone service and gasoline purchases for the agency's vehicle fleet - and established an oversight committee to make sure bids for supply contracts are transparent and low cost. The plan is financed by IESS funds currently deposited with the central bank.