The Senate finally approved the Financial and Monetary Code last night, sending it to the Chamber of Deputies. The key outstanding issue – whether savings and loans associations (S&L’s) would be authorized to offer the same range of financial services as commercial banks – was sidestepped by leaving it up to the nation’s Monetary Board (Junta Monetaria) to decide. The Senate made several key changes in the second reading in response to criticisms leveled at its first draft. Chief among these was changing its earlier restriction to one year on the term of office of the Central Bank Governor, the Superintendent of Banks and the members of the Monetary Board to open-ended, two-year and four-year appointments, respectively. Many analysts and expert observers had criticized the tight restriction on term of office for these positions as an open invitation to political tampering and lack of continuity in monetary policy. The Senate refused, however, to give back the Central Bank its exclusive right to designate the DR’s representation to the World Bank, International Monetary Fund (IMF) and Inter-American Development Bank (IDB). Under the bill now head to the lower legislative chamber, the Executive Branch would designate Dominican representatives to these financial institutions.
