Banco Central-GOOD NEWS FOR SAVERS

j&t's future

Active member
Mar 6, 2007
2,491
17
38
SANTO DOMINGO, Dominican Republic (Bloomberg): The Dominican Republic's central bank raised interest rates for certificates of deposit in an effort to slow consumer price increases after inflation accelerated last month.

The bank will now pay annual interest rates as high as 16 percent for 3-year certificates of deposit, compared with 14.9 percent previously, it said today in a statement on its Web site. The new rate is 8 percent for six-month deposits.

The increase in rates came on the same day the bank announced monthly inflation had accelerated to 1.71 percent in March from 0.31 percent in February, driven by higher costs for oil and commodities. The bank said that higher deposit rates are consistent with moves made by other Latin American central banks to ward off quickening inflation.

J&T
 

The Virginian

New member
Mar 16, 2007
929
8
0
j&t's future, do you have the URL to see this? I just went to their web site and it still shows the old rates. thanks Phil
 

M.A.R.

New member
Feb 18, 2006
3,207
146
0
Yes they do, I believe it's about $3,000 or $RD100,000.
Does anyone know? is it still the same procedure? You must go very early in the morning to the Banco Central branch, like 6am get a number to be called to open an account? I know you must have another account opened in another bank, where your interests can be deposited.
 

Syork

New member
Sep 5, 2004
151
4
0
Reservation at Banco Central

You can call their numbers :
809/221-9112
809/221-9121
809/221-9116
809/682-4914

You can get a reservation for a specific time- it's usually better after 1 PM when everyone is back from lunch. The operators don't always answer the phones but if you are persistant, you'll get through.

Even with a reservation it's an hour and a half-2 hour process so take a book!

Good luck.
Rick
 

Ricardo900

Well-known member
Jul 12, 2004
3,267
36
48
Just to be really clear, these high interest rates are for peso accounts, right? with interest paid in pesos?
Yes, it's for pesos, here's their web page with some good info.
Central Bank of Dominican Republic

I recall a very good thread a year or two ago when a poster was raving about making alot of cash by investing in CDs especially when the interest rate was much higher, if I find the link I'll post it. 16% is pretty damn good with little risk, can't get that here in the US.
 

ElvisNYC

New member
Jan 27, 2006
511
22
0
Yes, it's for pesos, here's their web page with some good info.
Central Bank of Dominican Republic

I recall a very good thread a year or two ago when a poster was raving about making alot of cash by investing in CDs especially when the interest rate was much higher, if I find the link I'll post it. 16% is pretty damn good with little risk, can't get that here in the US.
There is risk that the peso will devaluate against the dollar.

Let's say that you put 100,000 pesos into this account. Since the peso fluctuates in price every year, and let's say the peso devalues 16% in the first year from 34 to 39.40-40.00, and in subsequent years (up to the 3rd year) the peso will devalue 16%, you will not earn any money if you plan to convert those pesos to dollars.

However, the only way this would benefit anyone would be if the peso appreciates in price, which did happen a few years ago. Right now I don't see this happening !
 

Tamborista

hasta la tambora
Apr 4, 2005
11,357
896
113
There is risk that the peso will devaluate against the dollar.

Let's say that you put 100,000 pesos into this account. Since the peso fluctuates in price every year, and let's say the peso devalues 16% in the first year from 34 to 39.40-40.00, and in subsequent years (up to the 3rd year) the peso will devalue 16%, you will not earn any money if you plan to convert those pesos to dollars.

However, the only way this would benefit anyone would be if the peso appreciates in price, which did happen a few years ago. Right now I don't see this happening !
The 2007 RD inflation rate was 5.9% according to The Central Bank.
The tasa could go to 40! I think I will pass on Peso denominated paper, for now.
25% might entice me.

tambo'
 

NotLurking

Well-known member
Jul 21, 2003
1,862
547
113
Fyi

Banco Central is offering the following rates on ventanilla (at the windows) CDs WITHOUT early cancellation:
  • 180 days 8%
  • 365 days 10.5%
  • 18 months 11%
  • 24 months 12%
  • 30 months 14%
  • 36 months 16%

All investments or in RD$ ONLY! Minimum investment amount is of RD$ 100,000. Maximum amount of investment is not specified but it is usually RD$ 20,000,000. These rate are for Plazo Fijo CDs. Plazo Fijo CDs are CDs that DO NOT have an early cancellation option and MUST be held without exception to the maturity date.

All investment are handled by appointment only. All Investors interested in acquiring BC Plazo Fijo CDs will need to call or visit Banco Central to make an appointment for investment. Although, all investment are handled by appointments, investors should be prepared to spend a few hours (2-5) at the bank. Appointments at BC do not work as one might expect. Appointments are given as a unit in a 30 minute slot. BC divides the working day into 30 minutes slots and each slot has anywhere form 10-20 (perhaps more) units. In all actuality, when you make an appointment you are scheduled as part of a group for the time slot given to you as YOUR appointment.

Please note that interest payment can not be compounded and a dominican bank account where interest is to be pay is required to invest in BC CDs. Investors that do not have a local bank account where interest payments will be deposited will be rejected. Make sure you take your bank account number with you when you go to BC. If the bank account you are using is one WITHOUT a bank book -- ATM CARD ONLY -- make sure to get your bank account from you bank. The numbers that are stamped on the card usually are NOT the bank account.

Interest payments are calculated on a 365 day year and paid on a monthly basis to a local (Dominican) bank account as mentioned above. This means that your actual monthly interest payment varies from month to month. If you want to know exactly how much interest is due for a given month use the following simple formulas:

dip = (C * I) / 365
P = dip * D

Where:-
  • dip is the daily interest payment
  • C is capital (amount of the CD)
  • I is interest rate in decimal NOT as a percent
  • P is payment for the month
  • D is days in the month

Ex.:
If you invest RD$ 1,000,000 for 36 months at 16% and you would like to know what your interest payment for the months of February and March are:

Calculate dip: dip = (C * I) / 365
(1,000,000 * 0 .16) / 365 = 160,000 / 365
160,000 / 365 = 438.356
dip = 438.356


February:
Calculate: P = dip * D
438.356 * 28 = 12,273.968
or
RD$ 12,273.97

March:
Calculate: P = dip * D
438.356 * 31 = 13,589.036
or
RD$ 13,589.04

Note that once you figure out what the daily interest payment (dip) is, it is a simple matter of multiplying the dip by the number of days in the month.

The hours of service for BC CD investments is form 8:30am to 3:00pm Monday-Friday except holidays. Appointments are usually given from 1-3 days from the date of your call or visit. I suggest getting your appointment after 12 noon. Anywhere from 1:00pm to 2:00pm is good. Everyone seems to go in the early morning and the wait time is usually much longer. Also note that BC employees take 1-2 hours lunch breaks at 12 noon sharp. If you get an appointment for 11:00am you'll most likely spend 5 or more hours waiting! Appointments can be made in person or by phone, I suggest you call the for an appointment. The numbers are:

Santo Domingo:
(809) 221-9112 or (809) 221-9116

Santiago: (not sure but here is BC main number)
(809) 583-1151


On the day you visit BC to make your investment (buy ventanilla plazo fijo CD) you need:
  • if a Dominican resident, Cedula (Dominican national ID card)
  • if not a Dominican resident, Passport.
  • proof of your Dominican bank account, where the interest payments are to made.
  • proof of where the money came from. -- your can't say you *found it*
  • the money you are going to invest in a certified bank check (make the check payable to YOU)

NotLurking
 

M.A.R.

New member
Feb 18, 2006
3,207
146
0
The hours of service for BC CD investments is form 8:30am to 3:00pm Monday-Friday except holidays. Appointments are usually given from 1-3 days from the date of your call or visit. I suggest getting your appointment after 12 noon. Anywhere from 1:00pm to 2:00pm is good. Everyone seems to go in the early morning and the wait time is usually much longer. Also note that BC employees take 1-2 hours lunch breaks at 12 noon sharp. If you get an appointment for 11:00am you'll most likely spend 5 or more hours waiting! Appointments can be made in person or by phone, I suggest you call the for an appointment. The numbers are:

Santo Domingo:
(809) 221-9112 or (809) 221-9116

Santiago: (not sure but here is BC main number)
(809) 583-1151


On the day you visit BC to make your investment (buy ventanilla plazo fijo CD) you need:
  • if a Dominican resident, Cedula (Dominican national ID card)
  • if not a Dominican resident, Passport.
  • proof of your Dominican bank account, where the interest payments are to made.
  • proof of where the money came from. -- your can't say you *found it*
    [*] the money you are going to invest in a certified bank check (make the check payable to YOU)

NotLurking
Can the certified bank check be made in the USA and brought down there and does the bank check serve as proof of where the money came from?

Thanks lurking for all this valuable info.
 

NotLurking

Well-known member
Jul 21, 2003
1,862
547
113
Can the certified bank check be made in the USA and brought down there?
NO. The certified bank check should be from a local Dominican bank. Bringing a certified check from the USA will make the currency US$ and all investments are in RD$ ONLY. You could bring a certified check from the USA but you will have to exchange your US$ certified check for RD$ and then purchase a certified check at a Dominican bank.

..and does the bank check serve as proof of where the money came from?
Technically NO. The proof the bank is looking for is the origin of the funds being invested. As in, how the investor happen to acquire those funds. The bank will accept as proof of funds origin:
  • Tax return statements
  • sales documents of a home, car or business
  • court papers of any funds legally award
  • any legally verifiable document that proves the origin of the funds

NotLurking
 

M.A.R.

New member
Feb 18, 2006
3,207
146
0
one more question.

You must show proof even if its just the minimum investment of US$3,000? or is it with a higher amount of money?
 

NotLurking

Well-known member
Jul 21, 2003
1,862
547
113
You must show proof even if its just the minimum investment of US$3,000? or is it with a higher amount of money?
No, not at all!!! you must show proof if the investment amount is equal or over US$ 10,000.00 using the exchange rate as published by BC on the day of your investment. Sorry for the confusion! I assumed you where asking for proof of origin requirement because you wanted to invest US$10k or more.

NotLurking