November 8, 2018 / 5:16 PM / a month ago

Mexico stocks plunge on ruling party bank commissions plan

Nov 8 (Reuters) - Mexico’s banking stocks plunged on Thursday, after a Mexican senator from the president-elect’s party released a bill proposal that would prohibit or curb banks from charging commissions for certain services.

Mexico’s S&P/BMV IPC index was down more than 2 percent, with shares in Grupo Financiero Banorte down more than 11 percent. Santander and Gentera both dropped more than 7 percent.

The new shock to markets by the incoming government comes after president-elect Andres Manuel Lopez Obrador announced on Oct. 29 that he would scrap a $13 billion airport project, pummeling stocks and the peso.

The banking initiative, presented by Ricardo Monreal, Senate leader for Lopez Obrador’s Morena party, argues that banks in Mexico earn more in commissions than in many other Latin American countries.

It would prohibit financial entities from charging clients in various areas, including checking a balance, withdrawing cash and requesting past bank statements. The bill would also require the Bank of Mexico and Mexico’s banking regulator to create a plan to annually lower commissions on bank transfers.

“It’s terrible,” said Sergio Zermeno, a Mexican banking expert. “What’s truly worrisome is that we’re barely emerging from the shock that hit the country’s financial markets, resulting from the cancellation of the airport.” (Reporting by Daina Beth Solomon; Editing by Bernard Orr)

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