Costa Rica's Development Bank born with severe weaknesses
Costa Rica's development bank system was created with obvious weaknesses, such as inheriting a portfolio of problem loans and the obligation to charge interest rates that are so low that they don't allow for creation of a bad loans reserve.
Wednesday, June 11, 2008
As well, it carries with it the sad history of various aid programs, especially in agriculture, that make up a chain of failures and misuse of funds.
The Development Bank System (SBD) will start to function in December, but a great part of it is still incomplete and will take at least six months to complete.
The reform proposal submitted by the Government does not have the full backing of the Legislative Assembly.
The definition of the conditions and requirements for customers will be the responsibility of each entity, as determined in its policies and risk analysis.
After having missed the deadline for renewing the period for the committee to analyze changes in order to make the System for Banking Development more diligent, the project remains stalled in Congress.
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