The official monetary unit is the Dominican peso (RD) divided into 100 centavos. Minted in 1947, it maintains a floating exchange rate with the U.S. dollar and other international currencies. Around RD$17 = US$1. (December 2001). Exchange houses and commercial banks are authorized to trade with foreign currencies.|
The banking system is governed by the country's Central Bank, which is controlled by the Monetary Board and supervised by the Superintendency of Banks. The Central Bank regulates the country's credit, money supply and the official foreign exchange rate. Private banking is conducted by more than 10 commercial banks including major international institutions such as Scotiabank and Citibank.
The top performing industry in the DR in 2001 was the banking industry. Bank profitability has been increasing year after year. Banks benefit from a wide spread in the interest rates paid on deposits and those charged on loans. The sector is one of the few that has remained protected, with practically no competition from abroad. For a sampling of interest rates charged locally, see Superintendency of Banks
The assets of the financial sector were RD$187 billion in 2000. By September of 2001, they had increased to RD$218 billion, up 16.6% over last year.
An analysis of the banking industry, indicates that depositors are showing a preference for US dollars. Savings in US dollars in 2002 were US$861 million, or 50% more than in 1999. Savings in Dominican pesos increased only 8.1%.
In 2000, local banks granted loans for RD$74,727 million, up 23.5%. Banks gave preference to foreign currency loans, consumer loans and credit card financing. Credits in foreign currency reached US$1,092.4 million, up 47.3% compared to 1999. Banks granted RD$8,149.7 million in consumer loans, up 45% compared to the previous year.
Bank assets grew 25.2% in 2000, reaching RD$124,820 million. The five largest banks -- Reservas, Popular, Baninter, Bancredito and Progreso
-- had assets of RD$96,644.1 million, or 77.4% of the total assets of banks operating in the DR.
The Stock Market of Santo Domingo is a definite option for business development.
The local stock market trades in commercial paper.