The crisis was caused by a considerable contraction in Uruguay's economy and by over-dependence on Argentina (tourism, and construction boom), which experienced a strong phase of an economic meltdown itself in late 2001.
In 1990, Chemical Overseas Holdings, Inc. (a subsidiary of JPMorgan Chase) together with Dresdner Bank Latinamerika and Credit Suisse First Boston acquired the Banco Comercial del Uruguay (BCU), one of that country's oldest and largest national banks.
In the end, five financial institutions failed and hundreds of thousands of depositors in Uruguay, Argentina, and Brazil were left in dire economic straits after seeing their bank accounts literally disappear.
In January 2005, the Paris-based International Chamber of Commerce ruled that the Uruguayan government would have to pay US$120 million to JPMorgan Chase & Co., Dresdner Bank AG, and Credit Suisse First Boston for failing to maintain the solvency of the BCU.
[1] The role of the economist and academic Carlos Steneri [es] was also considered fundamental to the way out of the crisis.