The economist Javier Cascante Elizondo has been appointed as Superintendent of Financial Institutions (SUGEF) of Costa Rica.
A statement of the National Financial Supervision System (CONASSIF) reads:
The National Council of the Financial Supervision System this morning appointed Mr. Javier Cascante Elizondo as Superintendent of Financial Institutions, a position he will occupy from October 16, 2012, for a term of 5 years.
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.
The work of the committee dates from May 2010 and the aim was to decide how to use the $320 million. This fund is made of 17% of bank’s current accounts.
The government of Costa Rica is promoting a legal reform that would transfer the cost of financial supervision to banking institutions, insurance companies and pension operators.
The legal amendment was included in the Bill for the Efficient Management of Public Finances already sent to the Legislature.
So far, "the Central Bank is funding 80% of the operation of the Superintendent of Financial Institutions (Sugef), the Superintendent of Securities (Sugeval), the Superintendent of Pensions (Supen) and the Superintendent of Insurance (SUGESE)," reported Nacion.com.
Banks in Costa Rica must provide customer’s banking information directly to Costa Rican Drug Institute when requested by the office.
Financial institutions must provide people’s banking data to the Financial Intelligence Unit (FIU) on request, as prescribed by executive decree. The FIU is a department of the Costa Rican Drug Institute (ICD).
"This is the 'general regulation on legislation against drug trafficking, related activities, money laundering, terrorist financing and organized crime', published by the Executive on 17th January in the Official Gazette," reported Nacion.com. Mid-April is the deadline for all institutions involved to meet the standards of the decree.
The banks reported profits of nearly $276 million in 201, which is 22.5% more than 2010.
Banco Popular tops the list with earnings totaling $76 million, followed by BAC San Jose with $54 million.
An article in Elfinancierocr.com states: "... Banco Nacional (BN) remained in fourth place. This bank recorded in 2011, according to data reported to the Superintendent of Financial Institutions (Sugef), a drop in performance of 20% in real terms when compared to 2010.
The financing company is registering with the regulating authority the creation of a financial group made up by the financing company, an insurance seller and a leasing company.
Silvio Lacayo, Desyfin manager, said the proceedings were initiated in 2011 with the Superintendent of Financial Institutions and they are awaiting final approval by the agency.
Some entities said they would be willing to declare their individual data if the Sugef removes the restriction.
Since the weekly newspaper El Financiero filed a lawsuit pushing for banks to publish their capital adequacy indicators, the issue has been debated by the General Superintendency of Financial Institutions (Sugef) and the banking market.
Following this, a group of banks have said they would not object to disclosing the information, as long as the publications are endorsed by Sugef.
The reform proposal submitted by the Government does not have the full backing of the Legislative Assembly.
The way that resources obtained from the banking system are to be used is the main point that could further delay the implementation of the system of development banking (SBD in Spanish), which aims to provide financing to small and medium enterprises who do not have access today to traditional bank loans.
The financial soundness indicator of banks may no longer be kept secret if the Constitutional Court decides that it shouldn’t be.
An appeal filed by the weekly paper El Financiero could lead to a decision to make public the indicators of capital adequacy of banks in the country.
Currently this indicator is not published by the Superintendency of Financial Institutions (Sugef) meaning that bank users do not have this information when making decisions about which institution to turn to.
There have now been seven consecutive months during which the default rate of borrowers from the Banco Nacional de Costa Rica has increased, having exceeded the normal limit of 3% over the past three months.
The increase in defaults is due mainly to problems with real estate projects in Puntarenas and Guanacaste, said Bernardo Alfaro, deputy general manager of the bank’s risk management office.
In January 2011, indebtedness in Colones was 59% of total loans, compared to less than 50% in 2009.
The low Dollar value and relatively low rates in Colones encourage borrowing in national currency.
Gerardo Corrales, manager of BAC San José, told Nacion.com, "... the decision to take a debt in Colones or Dollars, besides interest rates depends on customer expectations of devaluation or appreciation of a currency against the other."
Nine of the eleven private banks operating in the market generated fewer profits in 2010 than in 2009.
The data published by the Superintendence of Financial Institutions (SUGEF), dos not provide information on Bansol, which began operations in November 2010.
"Private banks were mainly affected by the 9% drop of the dollar in 2010, as most of their assets are in that currency," reported the article in Nacion.com, "Since financial statements are done in Colones, transferring their assets from Dollars into Colones results in a lower valuation due to lost value in the price of the currency."
On the first of November Bansol became the 17th bank in the country.
The new bank will operate almost 100% electronically.
Few branches, small and without ATMs, were the words of its CEO Carlos Fernandez.
"The accounts opened will be linked automatically to the Integrated Electronic Payment System (IPNS) in order to facilitate the process of transferring to any destination within the domestic financial system," writes Elfinancierocr.com.
A court decision removed the obligation to collect commission on early fund recovery or to enforce minimum periods of investment for those funds.
The measure had been adopted by the Supervisory Board of the Financial System (CONASSIF), amending the General Rules on Mutual Funds Investment to prevent investors without the appropriate profile from entering into long-term funds.
Financiera Acobo is to obtain a banking license and become Banco de las Soluciones (Bansol).
The authorization was granted by the National Financial System Supervision (CONASSIF), making Bansol the tenth commercial bank operating in Costa Rica.
Alberto Dent, president of CONASSIF, told Elfinanacierocr.com, "...now we just need for the Superintendent of Financial Institutions (Sugef) to issue a certificate to the effect that the new entity meets all requirements and regulations (including minimum capital) so they can begin to operate as a bank."