Wednesday, August 12, 2015

Victor Vargas and Banco Santander - Learn the Story

What Happened When Victor Vargas Tried to Buy Banco de Venezuela?

In 2008, Victor Vargas met with the leaders of Banco Santander, a major bank based in Spain. Vargas owns a major Venezuelan bank, Banco Occidental de Descuento (BOD). On behalf of BOD, Vargas was interested in buying Banco de Venezuela, a local Venezuelan bank, that Santander owned.

After a series of meetings, the two banks agreed to the purchase. As part of the agreement, BOD put down a $150 million down payment.

The BOD Tower
The BOD Tower
By Andrew1393 (Own work) [CC BY-SA 4.0], via Wikimedia Commons

Venezuelan Government Officials Approved the Purchase

Venezuelan law requires the Venezuelan government to approve bank purchases. After signing the agreement with Santander, Vargas and the BOD management team met with Venezuelan government authorities who oversee the country's financial industry. BOD submitted all the requirements to the authorities, and the government approved the purchase.

Chavez Attempted to Takeover BDV

After BOD and Santander agreed to the purchase, and after Venezuelan officials put their stamp of approval on it, President Hugo Chavez abruptly intervened.

President of Venezuela Hugo Chavez
By Victor Soares/ABr (Agência Brasil) [CC BY 3.0 br], via Wikimedia Commons

One night, Chavez appeared on live Venezuelan television. He denounced BOD's purchase of Banco de Venezuela and announced instead that the government would buy the bank instead.

Vargas and BOD Lost $150 Million Deposit

After Chavez reversed course on the deal between BOD and Santander, Vargas contacted Santander. He wanted his bank's $150 million down payment returned.

Santander refused to refund the down payment.

BOD Sued Santander in a Spanish Court to Recover Down Payment

Citing the contract between BOD and Banco Santander, BOD filed a lawsuit in 26th Court of First Instance in Madrid, Spain. (In Spain, "courts of first instance" are the the main courts with jurisdiction over civil cases.)

The lawsuit demanded that Santander return the $150 million down payment.

In October 2010, the court ordered Santander to return the money plus the interest that had accrued since 2008.

Santander Appealed and Won

After a lengthy court battle that took 4 years, in 2014 the Supreme Court of Spain reversed the lower court's decision. The Supreme Court threw out the court's order that Santander must return the $150 down payment.

BOD Filed Appeal 

Soon after the Supreme Court's ruling, BOD filed a request with the same court to annul the decision.

The case is still pending.
  • For details about the battle between B.O.D. and Banco Santander, click here.
  • You can download the document with all the facts of the case by clicking here.

Monday, July 13, 2015

Victor Vargas charities in Venezuela

Venezuela’s Victor Vargas operates a number of charities, ranging from community development to helping entrepreneurs grow. He also runs charities that protect the environment and provide children with music education.

Venezuelan entreprenership

young entrepreneurs helped by Victor Vargas
Vargas helps young entrepreneurs get funding for their ventures.

In 2011, Victor created the Entrepreneur Program, a non-profit group that aids individuals in starting new companies in Venezuela. The Entrepreneurship Program specifically helps entrepreneurs who, for whatever reason, cannot raise capital from regular channels such as banks.

In its first period in July 2011, the program provided training to 100 aspiring entrepreneurs. It also gives away money to education programs and cultural enrichment groups, specifically targeting the poor and disadvantaged.

Since 2002, Vargas has invested $20 million in these initiatives in Venezuela. For example, the program funded the National Youth Orchestra of Chacao, which is conducted by the famous maestro José Antonio Abreu.

Energy consumption initiative

Energy-saving lightbulbs used in the Efficient Consumption program throughout Venezuela
Victor's Efficient Consumption program led to the installation of energy-saving technologies, such as these light bulbs, in corporate offices throughout Venezuela.

As the leader of the Banking Association of Venezuela, Victor Vargas helped start “Efficient Consumption.” The program has companies implement renewable energy devices at their buildings.

In a nod to community development and childhood education, Victor’s “Music for All” program teaches music skills in Venezuela to children of all ages.

Vargas also runs 4 non-profit foundations, which are managed through the bank, that focus on social responsibility. These programs incluce Solidarity Actions, BOD Award Educational Talent, Panty Smiles, BOD Center for Entrepreneurship, and the BOD Corporate Volunteer program.

Through the BOD Foundation, Vargas has given away 126 million bolivars to development projects in Venezuela and other Latin American countries since 2002.

Venezuela’s Olympic Committee

Olympics runners
Olympian runners line up for a race. Vargas represented Venezuela in the 2012 Summer Games in London.

For the 2012 Olympics in London, Vargas was the technical director representing the Venezuelan Olympic Committee. On July 20, 2012, he led a delegation from Venezuela to tour the Olympic Village and conduct an official inter-governmental meeting with the Organizing Committee.

About Victor Vargas

Vargas is the president of Banco Occidental de Descuento (BOD), one of the largest financial institutions in Venezuela. He is also a professional polo player, husband, father, and philanthropist.