The Government of Costa Rica has presented a legal reform to authorize foreign banks to open branches in the country. Foreign banks currently operate here through financial intermediaries as separate entities but not as branches of the parent company.
The reform to the Organic Law of the National Banking System, presented on March 8, would change this. This is part of a larger effort to integrate with the Organization for Economic Cooperation and Development.
Costa Rica is currently admitted to 12 of 22 technical committees of the Organization for Economic Cooperation and Development. It’s working on various reforms, such as with bank branches, to join the rest.
The proposal includes guidelines for regulation of the foreign banks’ local branches. It would allow the banks to choose whether to operate as branches or through intermediaries and explains how they will be regulated and supervised.