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The cohort of banks, comprising Bank of America, Goldman Sachs,  Citigroup, and JPMorgan Chase, are experiencing challenges in assembling a $20 billion loan to Argentina without exposing themselves to the financially troubled South American nation. On Monday, Argentina’s central bank announced it had inked a $20 billion exchange rate stabilization deal with the U.S. Treasury Department. The deal brought the total amount of U.S. assistance for the third-largest economy in Latin America to $40 billion.  Argentina’s central bank stated, “These operations will enable the Central Bank of the Argentinian Republic (BCRA) to broaden its range of monetary and exchange rate policy tools, including the liquidity of its foreign reserves.”  U.S. banks stall Argentina’s $20 billion loan over collateral According to a WSJ report, the banks are looking for a pledge or guarantee to ensure they receive their money back. The report confirmed that bankers are awaiting word from the Treasury Department over what collateral Argentina can offer them or whether Washington intends to support the facility independently. In the report, analysts said that the banks cannot take action without Washington’s support. They claimed the Treasury has been overseeing the larger package, even though banks typically set up these kinds of rescue facilities on their own. The analysts argued that if the banks’ collateral question is not answered, the lending facility, which hasn’t been formalized, might not come together. A U.S. Treasury spokesperson said, “discussions on this facility remain ongoing, and we look forward to sharing more details when these talks are complete.” The report also revealed that U.S. banks haven’t been lending to Argentina and have been shut out of the international capital markets for years. Successive governments have borrowed dollars or printed money rather than cutting spending to narrow chronic budget gaps, leading to runaway inflation. The third-biggest economy…

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Filed under: News - @ October 21, 2025 2:27 pm