November 1, 2013
Authorities in the Dominican Republic are doing their best to revive a flagging economy. But for the nation’s banks, the policy measures have not been without their costs.
GDP growth dropped from 7.8% in 2010 to around 4% in 2012. The government reformed the tax system in late 2012, increasing value added tax among other measures. At the same time, it cut spending in the early part of 2013. The economy felt the pinch: preliminary IMF data indicated that GDP growth fell to 1.6% year on year in the first half of 2013.
The economic slow-down, weaker business confidence and lower domestic consumption has hit banks, says Fitch. Yet the ratings agency points to Banco Popular Dominicano, the co
Fiscal reform in the republic has put pressure on bank profitability