While financial regulators want to increase the quality of banks' management with better qualified managers, a bill intends to reduce the demands of professionalism for a "popular" bank.
The intention of six members in reforming the Organic Law of the People's Bank (Banco Popular) and Community Development (BPCD) is to increase control of the union on the bank's management which is "... moving away from sound banking practices and is worrying not only from a point of view of financial supervision, but because it jeopardizes the savings of workers" according to the statement by the National Council of financial System supervision (Conassif) published by La Nacion.
Three state banks have approved a syndicated loan for the Hydroelectric Project Los Negros II, 40 MW, whose construction will start in April in Upala, Alajuela.
The three banks are Banco Nacional, Banco de Costa Rica and Banco Popular and Banco de Desarrollo Comunal, and the trust for the Hydroelectric Project Los Negros II, "... emerged as an initiative of the Public Service Company of Heredia (ESPH) as part of its strategy for energy sources. "
Fitch Ratings has revised from "stable" to "negative" its perspective for international long-term ratings of the private bank BAC San José and the state banks Banco Nacional, Banco Popular, Banco Internacional and Banco de Costa Rica.
From a statement issued by Fitch Ratings:
Fitch Ratings has revised the Outlook for international long-term ratings of four Costa Rican banks and a Panamanian subsidiary from Stable to Negative, after having revised the Perspective for Costa Rica's sovereign rating from stable to negative :
The project known as the Integrated Banking Solution for Banco Popular de Costa Rica which began in 2008, and has had $4 million spent on it, has never worked and has now been declared obsolete.
An article by Crhoy reports that the Comptroller General of the Republic rejected an appeal by Banco Popular to be allowed to modify the original contracts signed with the U.S. firm Tememos USA Inc, to extend the time limit for its execution.
Using standardized issuances, the Costa Rican entity intends to raise funds in the financial markets of Nicaragua, El Salvador and Mexico.
The idea "... is to raise funds by issuing securities on the stock exchanges of these countries with the aim being that investors can obtain the funds and channel them into placing loans here," noted an article in Prensalibrecr.com.
Private banks operate with margins between interest rates which are considerably lower than state banks.
An article in Elfinancierocr.com points out that "the five banks with the lowest margins in the country are private ones, as is clear from a study by EF based on data reported to the Superintendent of Financial Institutions (Sugef) for December, 2012 ".
The fall in interest rates has caused an increase in bond prices, encouraging holders to make profits.
During the first quarter of 2013, the stock market in Costa Rica grew by 18%, with the secondary debt market being the best performing, going from $1.34 billion in the first three months of 2012 to $3.459 billion in the same period of 2013.
At the Banco de Costa Rica the volume of assets received in lie of payment increased by 70% compared to 2011.
A survey by Elfinancierocr.com between 6 financial institutions, including the four public banks in the country, revealed that in February of this year, there were 1259 properties in their possession, in contrast to the 884 properties that were reported in the same period 2012, ie there was a 42% increase.
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